You hear a lot these days about home warranties, with some homeowners swearing by their usefulness and others feeling a bit dissatisfied. However, as long as you read the fine print carefully, take care of your covered systems and adhere to the contract’s instructions, you should have no issues taking advantage of a home warranty policy. Those with newer homes may still have appliances under warranty as well as systems under protection from the builder’s warranty, making a home warranty redundant. Yet, those with other homes and aging systems and appliances have good reason to consider investing in such a policy.
What is a Home Warranty?
Home warranties can best be described as supplemental policies that cover items that standard homeowner’s insurance does not. These optional service plans generally help with the repair or replacement of common household appliances and many of the costlier systems such as plumbing, HVAC and electrical. In return for a monthly fee, home warranty companies offer to make repairs to covered systems. In cases where repairs aren’t feasible due to outdated parts or other situations, the company will replace the appliance or system with a comparable model.
Home warranties are designed to ease the burden on homeowners by having policy holders make one simple call to the claims center to get the repair process started. The claims center representatives will then find a local technician on their provider network and schedule a home visit to evaluate the system or appliance in question. There will be service fees implemented for each call, and there may be charges above the policy’s max limitations, which is about $2000 per repair with most companies.
The Benefits of Home Warranties: How These Policies Protect Your Home
While home warranties do not cover structural damage and other items covered by home insurance, they do offer policy holders a nice level of protection concerning costly repair bills. Even worse scenarios will involve replacements such as the refrigerator that can cost $2000 or more or an HVAC system replacement that can also cost thousands. A good home warranty company can at least help offset these costs, which comes in handy when things break down unexpectedly.
You often hear, “They don’t make ‘em like they used to,” and this is certainly true of many appliances and systems in homes today that average ten years of life. A home warranty lets you be mindful of your budget by giving you a monthly rate for coverage and modest service call fees. It is also nice to know that home warranty companies work with a network of providers and back up the service you receive from them. Your home is a valuable investment, so taking this extra step of protection if you have an older home is a wise move.
What do the Best Home Warranties Cover?
Almost all basic home warranty policies will cover your home’s basic appliances including dishwashers, refrigerators, washing machines, dryers, garbage disposals, trash compactors etc. More comprehensive policies will also offer coverage for major home systems like plumbing, heating, cooling, water heaters, electrical components, and exhaust fans. Some of the best coverage comes with higher priced policies that will also cover incidents such as roof leaks and spa and pool repairs. Most home warranties are valid for one year and may be renewed at the discretion of the company and policy holder
How Much Do Home Warranties Cost?
Many factors will determine how much a home warranty will ultimately cost you. A primary consideration is the age of your home and the condition of your current systems and appliances. Many home warranty companies require a pre-contract inspection to ensure that all covered items are currently in working order. You must also properly maintain these systems during your coverage term to qualify for repairs or replacement. Signs of misuse or neglect will result in a denied claim.
On average, those seeking to cover their home’s appliances only pay between $30-$50 per month. Policies that cover the more expense and complex systems in the home average between $50-$100 per month. Homeowners who desire policies that cover amenities like swimming pools and spas may have to pay a supplemental fee in addition to basic policy costs. Additional fees for covered appliances are typically limited to a service fee between $60-$125 per covered item. If you want higher limitations of coverage for expensive devices and amenities, some companies may offer more advanced policies at additional costs.
One final consideration concerning costs is where you reside. For example, a major carrier offers an appliance plan in Ohio for $480 and a policy that covers appliances and major systems for $600 annually. However, in New York state, those same policies can cost $900 and $1100 respectively. Be sure to shop around, get several quotes and read users reviews before making a decision on who to choose.