Repairs are an inevitable part of living in a home, regardless of whether you own it or rent it. Appliances malfunction, faucets leak and HVAC units can shut down in the middle of a heat wave. Instead of depleting your savings for these repairs, some people buy home warranties to ease the cost of common home repairs.

But, are home warranties worth both homeowners and renters? Learn more about what a home warranty is, when someone should buy it and whether a home warranty is right for you (plus what the best home warranty companies offer).

What is a home warranty?

Home Warranties are rolling home service plans that provide discounted repair and replacement services for covered home appliances and systems. Contract terms vary, and coverage depends on the type of warranty you purchase. It does not provide the same coverage that home insurance does, so it is important to know the difference between home warranties and home insurance.

Homeowners insurance protects policyholders from damage to personal property and the structure of the home, such as fire damage or theft.

What does a home warranty policy include?

Home warranties are a supplement to home insurance. Depending on the level of coverage you purchase, most plans will typically cover most major components of large home systems, such as heating, ventilation, air conditioning, water heaters, plumbing, and electrical. Some plans cover appliances such as washers, dryers, refrigerators, and stoves. You can also purchase optional additional coverage for your spa, second fridge, pool, pumps, sewer systems and more depending on how much you can pay for your home warranty.

How does a home warranty work?

Home warranties are offered via a contract for a monthly or annual fee. Under the terms of the contract, you get a fixed service call fee and annual coverage limits for repairs. Service fees and coverage limits vary by company.

If a home system or appliance fails, you can file a claim online or contact the warranty customer service team. They connect you with an authorized service provider to assess the problem and then perform the repair.

What do home warranties not cover?

Home warranties will cover the cost of repairing many home appliances and systems. The extent of coverage depends on the warranty company and the level of coverage you are purchasing.

However, some common ones are generally left out:

  • Structural issues in foundations, walls, paint and floors
  • Commercial grade equipment or systems
  • Pre-existing conditions
  • normal wear
  • Rust, corrosion and sediment problems
  • Improper maintenance, installation, design, manufacturer defect, or previous out-of-contract repairs
  • Detection and removal of asbestos, radon gas and mold
  • Violations of the building law and zoning

Is home insurance the same as home insurance?

Whether you own a home for the first time or just bought your next home, there are many important things you should know. For example, what is the difference between a home warranty versus home insurance?

A home warranty is a policy that covers the costs of servicing, repairing, and/or replacing certain systems within your home if they fail unexpectedly due to manufacturer defect, wear and tear or some other related issue.

On the other hand, home insurance is a policy that financially protects you, your home, and personal belongings in the event of a catastrophe beyond your control, such as a fire, storm, or accident on your property that results in bodily injury. Home insurance is not required by law. However, since you can’t get (or keep) a mortgage without it, homeowner’s insurance is something nearly every homeowner should use in their budget.

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How much is the home warranty?

When buying or renting a home, a home warranty will likely be offered as protection against unexpected costly repairs. Sounds like a great idea, especially since the average monthly fee for home warranties is Between $25 and $50. Home warranties are usually a 12-month contract.

Do I need a home warranty?

Unlike home insurance, a home warranty is not mandatory when moving to a new home. However, whether you’re buying a new or previously owned home, it’s important to consider whether it’s worth a long-term home warranty. For example, if an inspection of your home shows that many home appliances and systems are nearing their lifespan, a home warranty can help reduce any future repair or replacement fees.


  • Peace of mind for those buying a home with used appliances and old systems
  • comfort. (There’s no need to spend time looking for dozens of repair technicians.) A home warranty company has a network of trusted professionals.
  • No DIY skills or tools needed
  • Relatively inexpensive to purchase. Average monthly fee Under $100.


  • Set coverage limits per repair or per year
  • Service connection fee. Every time you have an accident, you will have to pay a service call fee which can range from $50 to $75.
  • accurate print. Claims can be denied if an item is not properly maintained. Your warranty provider may ask you to provide proof of maintenance.
  • Less control. Home warranty companies determine whether the system must be repaired or replaced.
  • You may never use it.

Should I buy a home warranty?

A home security can be an excellent option to protect your investment in a home. When combined with a good homeowners insurance policy, you can cover most of your bases. However, if you buy a new home, many home systems are covered by manufacturer warranties.

The same is true for new devices. Before you take the plunge and buy a home warranty, make sure your systems aren’t already covered first.

How to choose a home warranty

When owning a home, it is important to know that repair and replacement of home appliances and home systems is inevitable. Therefore, when choosing a home warranty plan, it is important to consider how much coverage you will need, contact several reputable home warranty companies for quotes and read the finer details of your home warranty plan. In addition, you can always discover the best home warranty companies here.

When is the home warranty skipped?

Usually, when buying a newly built home, the likelihood that you will need a home warranty is slim given the myriad guarantees already offered. For example, you will generally receive a warranty from the builder for the materials and manufacture of the home, including the plumbing, electrical, heating, and cooling systems. However, although the hardware is not usually covered by the manufacturer, it generally comes with a manufacturer’s warranty as well. Therefore, home warranties are usually not required for up to ten years after you move into your newly built home.

When is a home warranty worth it?

A home warranty is worth it for homeowners if they are seeking the peace of mind it provides with their home hardware and systems. So when is a home warranty worth it? Whether you’re buying a home or are simply concerned about the life of your appliances or systems, home warranties are a great way to protect your investment and wallet if a major repair is needed.

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