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A home warranty is a service contract that covers the repair or replacement of crucial home systems and appliances that may break down due to normal wear and tear. It offers homeowners peace of mind, knowing they’re protected from costly repairs. If you're a new homeowner, or even if you've lived in your home for years, understanding the ins and outs of home warranties can be essential to safeguarding your property and budget.
In this guide, we’ll walk you through the home warranty process, the different types of coverage available, frequently asked questions, and provide actionable steps to help you choose the right plan for your home.
A home warranty is a contract between a homeowner and a warranty provider that offers discounted repair and replacement services on major home systems (like plumbing, electrical, and heating) and appliances (such as refrigerators, washing machines, and ovens). Unlike homeowner’s insurance, which covers structural damage and losses due to external events like fires or theft, a home warranty covers internal mechanical failures and normal wear and tear.
Choosing a home warranty can be overwhelming, especially with the range of options available. Here's a step-by-step guide to help you navigate the process:
Assess Your Needs
List your major home appliances and systems, noting their age and condition.
Consider whether you live in an older home with aging systems or if your appliances are nearing the end of their lifespan.
Think about the climate where you live, which could affect certain systems like HVAC.
Understand Your Coverage Options
Basic plans usually cover essential systems like heating, cooling, electrical, and plumbing.
Expanded or premium plans might include coverage for appliances like dishwashers, refrigerators, and washers/dryers.
Optional add-ons could cover pools, hot tubs, septic systems, and more.
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Understand the Contract
Carefully review the service contract, paying attention to the service call fees, limits on payouts, and exclusions.
Ask for clarification on any ambiguous terms.
Check for Pre-Existing Conditions
Home warranty companies typically don't cover pre-existing conditions, so make sure your systems and appliances are in good working condition before applying.
Evaluate Customer Support
A reliable home warranty company should offer excellent customer service, be responsive to claims, and provide easy access to service contractors.
Most home warranty companies offer two primary types of coverage: systems and appliances. Some providers offer customizable plans where you can pick and choose which items to cover, while others offer preset packages.
This generally includes major home systems such as:
Heating and cooling systems (HVAC)
Electrical systems
Plumbing systems (including stoppages)
Water heaters
Ductwork
This typically covers the essential home appliances, such as:
Refrigerators
Dishwashers
Ovens and stovetops
Clothes washers and dryers
Built-in microwaves
Garbage disposals
If you have additional components in your home, many providers allow you to customize your plan with add-ons, such as:
Pool and spa equipment
Well pumps
Septic systems
Central vacuum systems
A home warranty can be an invaluable resource for homeowners looking to protect their home’s systems and appliances. Whether you’re a first-time homeowner or a seasoned property owner, understanding your coverage options, the claims process, and the benefits of a home warranty will help you make informed decisions that safeguard both your home and budget. Remember to carefully evaluate your home’s unique needs, compare multiple providers, and read the fine print before committing to a plan.
For more personalized recommendations on home warranty providers that suit your needs, you can take our quiz.