What does a home warranty cover?
In a perfect world, nothing would ever break down in your home. Everything would function forever. The only time you’d have to replace or repair something is to add more functionality or convenience. Sadly, we all know this is far from possible. Every item has an expiration date and using them only speeds up the deterioration. Therefore, it is not a matter of if something will break. It’s a matter of when. Fortunately, this is what a home warranty covers. With it, you’ll have an extra layer of safety when something goes awry. And, with it, peace of mind. But, what’s the extent of home warranty coverage? That’s what Consumer Opinion Guide is here to answer today.
Why do you need a home warranty?
“Hope for the best, but prepare for the worst” is excellent advice. Especially so for homeowners, old and new alike. And, even more so, for those owning older homes. The thing is, you can never choose when something will break. You can plan for it, sure – but never predict it with certainty. This puts you in an unfavorable position, and for more reasons than one.
First, you’ll have to set a significant sum aside, for this exact purpose. Repairing home systems and appliances can cost anywhere from a few hundred to a few thousand dollars. Replacing them – even more. Meaning, a good part of your funds will be locked indefinitely.
Next, you’ll need access to a whole network of reliable, specialized technicians. A “jack of all trades” won’t do much for you, except postpone the inevitable.
Lastly, said technicians must be at your beck and call. A malfunctioning home system or appliance is more than an inconvenience. It can hinder your functioning and reduce your quality of life. Therefore, they must be ready to react ASAP. And, let’s face it, it’s not like they sit around all day. Enter a home warranty coverage – a simple way to counter all of the above.
What is a home warranty?
A home warranty is a contract that can help you cover repair or replacement costs of household appliances and systems. Or, in non-technical terms, it is your safety net in case any of the covered items malfunctions. With home warranty coverage, you won’t have to address the issue yourself. All you have to do is give your service provider a call. They’ll send their own technician to evaluate and address the problem. This will cost you a set amount, depending on the specifics of the contract. Usually, it’s anywhere from $50 to $125. So, not nearly as much as full repair or replacement would cost.
The best thing is that you don’t have to search for technicians yourself. You don’t have to risk encountering someone who will overcharge you, or further escalate the situation. Therefore, a home warranty doesn’t protect you from unforeseen expenses only. But, also, from time-sinks, inconvenience, and a whole lot of headaches.
What systems and appliances does a warranty plan cover?
Now we come to one of the neatest things about this type of insurance. Home warranty coverage is based on what you need. A policy can protect virtually every item subject to usual wear and tear. You can protect all the major systems or only some of them. You can insure your most-used appliances, and leave out the non-essential ones. Some providers even allow for some “hybrid” or “combo” plans. Here, you can mix and match to your heart’s content, and end up with the plan that suits you perfectly. However, not every company includes everything in their offer. Therefore, it’s advisable to check out different home warranty providers and find the one that has everything you need. But, let’s dive a bit deeper and see some concrete examples of what a home warranty covers.
Home Systems Warranty Plan
Home System Policy is the prime example of what a home warranty covers. This plan protects the most vital components of your home:
- Electrical systems;
- Plumbing systems;
- Heating systems;
- Cooling systems.
This type of coverage also addresses the issues of interconnected components. So, you can expect coverage on pipe leaks, circuit board problems, ductwork, etc.
Some companies even include some appliances in their Systems plans. Things like:
- Water heater;
- Garbage disposal;
- Ceiling fans;
- Smoke detectors;
and many more. The list is quite extensive and varies from company to company. But, this is quite enough to give you a basic idea of what a home warranty covers.
Appliances Warranty Plan
Appliance warranty, as the name suggests, protects items that make your life easier. The most commonly covered items are:
- Range, cooktop, and/or oven;
- Built-in microwave;
- Kitchen exhaust fan;
- Refrigerator, water cooler, and/or ice maker;
- Garbage disposal and/or trash compactor;
- Clothes washer and dryer;
- Smoke detectors;
- Ceiling fans;
- Garage door openers.
Once again, the specifics will vary, based on the plan you chose. So, always read the fine print. And, of course, don’t hesitate to ask if you can include or exclude an item from the plan. More often than not – you can!
Warranty plan add-ons
Systems and appliance plans alone can protect a large part of your home. However, some companies take it a step further and offer the so-called “add-ons” to basic package(s). Said add-ons may include less-used home systems or even those that are not part of the home per se. Here you can get coverage for:
- Septic systems;
- A well pump;
- Swimming pool, spa, and hot tubs;
- Roof leaks (albeit limited);
- Pest control;
- Extended electronic warranty, etc.
Do note that, in some cases, these add-ons include only partial coverage. Some companies may cover full repairs, while others may service only specific components. So, all the more reason to read that fine print.
Things that home warranty does NOT cover
An average annual warranty policy can cost anywhere between $350 – $600. Quite the deal, right? However, there is a catch. The reason why premiums are so low is simple: a warranty company can’t cover every single repair. Therefore, they place certain exclusions or limitations on their plans.
The most common exclusion reasons are:
- Pre-existing conditions at the time the warranty takes effect;
- Improperly installed systems and/or appliances;
- Damage caused by the lack of maintenance;
- Damage caused by misuse.
If a warranty agent encounters any of these problems during a home inspection, they can exclude said systems or appliances from the policy. Then, it falls upon you to repair or replace them. This is why it is an excellent idea to get the agent to do a survey before you buy a home. Especially if the said home is old or a “fixer-upper.”
Limits work a bit differently and aren’t as constrictive. It simply means the company sets the maximum allowed payout. If repair or replacement cost exceeds the set amount, they will still cover the base, but you’ll have to pay the excess.
Do not mistake home insurance for warranty
Mixing up home insurance and warranty is quite common. After all, they do sound similar. Yet, they have almost nothing in common.
Home insurance covers:
- The structural integrity of a home, both interior, and exterior;
- Property damage caused by natural disasters (fires, storms, floods, etc.)
- Damage or loss of personal property in case of theft;
- Cases of general liability.
Therefore, homeowner’s insurance protects you from situations that can happen but aren’t guaranteed. A home warranty plan protects you from inevitable. Since you’re using home systems and appliances daily, they’re bound to break, sooner or later. So, home warranty coverage gives you the means to combat these problems without breaking your bank or nerves.
A home warranty coverage is more than a convenience
Today, there’s an abundance of ways to protect yourself and your home. However, most of them focus on external factors. That’s the deal with home security systems, for instance. But, also, with home insurance. But, what a home warranty covers and protects you from is something much more basic – time. Given enough of it, any appliance or system will malfunction. And, it’s not a presumption – it is a fact. Furthermore, constant use does nothing to slow the process down. Quite the contrary – it only makes that solemn hour come faster. That’s why a home warranty isn’t a mere convenience. It is a way to maintain the quality of life you’re used to. So, if you’re still wondering if getting it is the right step, the answer is a resounding “YES.”