When most people move into a new home, the expectation is that there will be no major repairs to make. No leaky pipes to replace or busted furnaces to fix. Unfortunately these things do happen from time to time and new homeowners can be stuck with a hefty repair bill when they do.
To avoid this undesirable expense, some home buyers opt to purchase a home warranty plan. Keep reading to find out what a home warranty is, who needs one, what it will cover and what you can expect to pay for it.
What is a home warranty?
Although many people believe homeowner’s insurance is the same as a warranty, it’s not. While homeowner’s insurance can protect you from natural disasters and vandalism, a warranty covers most of your major appliances and home systems. A home warranty is purchased from a warranty company and works on a contract basis, typically for one year from purchase. The home warranty company typically works with local contractors to make repairs as they are needed.
What does a home warranty cover?
Home warranties vary in shapes and sizes, but as a general rule they will cover major appliances and home systems.
Here are typical items a home warranty covers:
Major appliances - ovens, refrigerators, dishwashers, washers, and driers.
HVAC systems - furnaces, air conditioners, heat pumps, and duct work.
Electrical systems - control panels and wiring.
Plumbing systems - indoor pipes, faucets, and other major components.
Here are typical items a home warranty does not cover:
Structural issues - cracks in foundation, cosmetic blemishes, or minor damages.
Appliance parts - refrigerator shelves, oven racks, etc.
Natural disaster damages - flood damage, hail damage, etc.
How much does a home warranty cost?
Although each home warranty plan is different, you can expect to pay between $250 - $500 for a year’s worth of coverage. Many home warranty providers run annual specials so make sure to shop around before you make a decision.
Who needs a home warranty?
Purchasing a home warranty is not the right decision for everyone. For homes with older appliances or systems, however, they might be a worthwhile investment. We can help you decide. We work closely with our clients to determine whether a home warranty is necessary and refer them to trusted providers whom we have worked with in the past.
Have you ever purchased a home warranty before? What was your experience like?