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First American offers affordable, comprehensive coverage for most of the country, but is it worth the investment?
Home ownership truly is the American Dream, and First American wants to help prevent that dream from turning into a nightmare.
If major appliances or home systems break down, wear out, or suddenly fail, you might be looking at a bill in the thousands — or tens of thousands — of dollars. Many people think these big repairs would probably be covered by their homeowners insurance, but those people would be wrong. More on that in just a bit.
If you’re concerned about your ability to pay for major home repairs should they arise, a home warranty might be for you. Here we’re going to look at one of the most popular home warranty providers out there — First American — to help you get a better idea of its coverage, its costs, and if you should select it to protect your most important investment.
First, though, let’s talk pros and cons to get a little context.
For the most part, First American seems like a pretty good choice. It offers wall-to-wall coverage that’s pretty affordable. While it’s unfortunate that it’s not available everywhere, most people who’ve worked with this company seem to have had good experiences. So far, so good.
In the most simple terms, a home warranty is an agreement between a homeowner and a warranty provider for discounted repairs or replacements of a home’s major appliances and systems. You pay a small fee, and the warranty provider takes care of your washing machine when it breaks or your AC when it conks out.
Pro Tip: While they might sound similar, a home warranty is completely different from homeowners insurance. To better understand how each functions, check out our home warranty vs. homeowners insurance guide.
your home and diagnose the problem, and there will be caps on how much the warranty company will pay for certain repairs and replacements. You might also find that the warranty company won’t cover something based on how it was maintained or its age. That’s why it’s really important to understand your coverages up front before you’re ankle-deep in water because a pipe burst in your basement.
With that in mind, let’s bring the focus back to First American and take a look at what it protects.
First American takes a tiered approach to its coverages and offers three packages: Starter, Essential, and Premium. As you might expect, the coverages increase as you move up the ladder, as do the monthly prices. Let’s take a look at the breakdown:
|Garage door opener||No||Yes||Yes|
|Luxury appliance coverage||No||No||Yes|
|Full garage door system||No||No||Yes|
|Instant hot water dispenser||No||No||Yes|
|Additional coverage and enhancements||No||No||Yes|
First American also offers optional add-ons to their packages. For an Essentials plan, these include:
|Pool and spa equipment||$20.83|
|Septic tank system||$7.08|
|Limited roof leak||$8.33|
While First American offers pretty comprehensive coverages, there are a few things it won’t help you with. These factors are important to understand before you make a decision on whether or not to go with it.
First of all, if you live outside First American’s coverage zone, you’re out of luck entirely. This warranty service is available in only 35 states, so you’ll need to find another provider if you live in:
If you live in one of the covered states, though, it’s also important to understand your First American warranty isn’t going to cover things like damage from fires, natural disasters, or theft. That’s what your homeowners insurance is for. If you’re a little unclear on those coverages, check out our homeowners insurance explainer; you’ll find all the details there.
Pro Tip: Like we said above, there is a clear distinction between homeowners insurance and home warranties, but you want to make sure both are going to be giving you optimal coverage. If you’re unsure how your homeowners insurance stacks up, check out our roundup of the best homeowners insurance providers of 2023.
Also make sure you read the fine print. There are limits to how much First American will pay for each category of coverage. For the most part, the Essentials plan will cover repairs and replacements of normal systems in modest homes, and the Premium plan will cover more expensive items in larger dwellings. To get a better idea of what these limits look like, you can view a sample contract.
Now that you understand what First American will and won’t cover, let’s get to the all-important question of costs.
How much you’ll pay for a home warranty from First American depends on a number of factors, including what you want covered, the protection plan you select, where you live, and the size of your home. That said, its prices are pretty reasonable when compared to competitors’, and its online quote tool makes it really easy to see what you’re covering and how much you’ll pay.
For a modest home in the Atlanta area, the Starter Plan costs $47 per month, the Essential Plan costs $57 per month, and the Premium Plan costs $72 per month. Overall, this is fairly standard for the industry — right in the middle in terms of affordability.
One interesting thing about First American, though, is that you can also decide how much you’ll pay to cover your service requests: $75, $100, or $125. Obviously, the lower you go, the higher your monthly fee will be. For context, our Essential Plan estimate started at $57 per month with a $125 service fee but jumped to $72 per month when we selected a $75 fee. If you’re looking for cost savings, we’d definitely recommend keeping your service fee high. Let’s talk about that and some other ways to save with First American.
There are lots of ways to save when you go with a home warranty from First American. The first is by keeping your service fee at $125. Why? Let’s do some quick math.
If you go from $125 to $75, you’ll save $50 on your service calls, but your monthly price goes up by $15. That means if you don’t require service for three months, you’ve already burned through what you’d save on the service fee by paying a higher monthly bill.
Pro Tip: Keeping costs low is important when you’re trying to protect your home. Home warranty providers are pretty transparent, but do you know if you’re overpaying on your homeowners insurance? Check out our guide to affordable homeowners insurance coverage to find out.
Another way to save is by paying your bill annually. Our quote was $57 per month or $660 per year. If you don’t have a calculator handy, that’s a savings of $24 over the course of the term. It’s not a huge amount of money, but it’s something.
Finally, First American does occasionally offer discounts and promotions. Before you purchase, do some googling around. You might stumble across a sale, especially if it’s around a holiday.
Now that we’ve discussed what First American’s services look like, let’s get an idea of what customers think about them.
From what we can tell, most folks have a pretty good experience when they choose to go with First American. It has been given a B ranking by the Better Business Bureau, and it has earned 3.7 out of four stars on Trustpilot.
It is a little concerning that there are over 4,000 complaints about it on the BBB’s site, but keep in mind the company has been registered there for over 20 years. When you consider that most people take to their keyboard only when they’ve had a bad experience and generally keep quiet when they’ve had a great one, we think that volume is reasonable. Here’s what people are saying, though:
This is one of the good reviews found on the BBB site, from Debra O.:
I’ve owned two homes in Memphis and each time I purchased a home warranty with First American Home Warranty. I’ve had no problems that would make me leave the company. I filed claims for water damage, hot water tank, sewage back up, and most recently the replacement of my heater over a span of 8 years. The only delay was an increase in calls for the heater. My experience has been great and has saved me thousands of dollars.
There are negative reviews as well. As always, take user reviews with a grain of salt, as there are two sides to every story. In our extensive research, we found First American to have a solid reputation overall.
There are quite a few benefits of selecting a First American home warranty. The first, obviously, is that you’re not going to be on the hook for costly repairs to your home’s systems and major appliances. Just be sure you’re comfortable with your coverages and caps. First American is pretty transparent and makes this easy to understand, which is a major plus.
Pro Tip: If you’re looking for another rock-solid home warranty provider to compare First American to, we’d recommend checking out our review of Choice Home Warranty. This is another affordable option with customizable coverage.
The second benefit is that you won’t have to track down a technician when you’re going through a stressful situation. If your heater goes out in the dead of winter, do you really want to be trying to find someone who can service it at midnight? First American Home Warranty has people on call 24 hours a day, seven days a week should something go wrong, and it guarantees any service its technicians provide for up to 30 days. That means you know the job will be done right, and if it’s not, the company will make sure it’s fixed.
The last benefit we’ll mention is First American’s flexibility. It’s one of the few home warranty providers out there that can cover improperly installed equipment or systems that weren’t maintained correctly. Just make sure you understand your coverages, though, because these protections aren’t offered on all plans universally.
These are all important aspects to consider, but if we’re talking about the benefits, we also have to mention the drawbacks.
The primary drawback of First American is that its services aren’t available in all 50 states. Sorry, Mainers, Rhode Islanders, Wisconsinites, and a handful of others; you’re not going to have access to a First American Home Warranty. Funny enough, if you’re from Delaware — the First State — you also can’t purchase a policy. First American won’t cover the first Americans? Ironic, isn’t it?
Pro Tip: If you’re purchasing a new home or building one yourself, it might not be worthwhile to purchase a home warranty. Your appliances and systems are likely still covered by the manufacturer’s warranty and are likely decades away from reaching the end of their lifespans.
Another drawback is the price. I know we said First American is pretty affordable — and it is — but if you want to add additional coverages to your plan or go for a higher tier of protection, the costs jump up pretty quickly. A Premium Plan with a few add-ons can easily cost you well over $100 per month, at which point you might be better off taking that money and putting it into an emergency fund to cover costs yourself.
Now that we’ve discussed pretty much all there is to talk about regarding First American Home Warranty, let’s answer the final question: Should you purchase one of its warranties?
Taking all of this into consideration, we’d say yes. If you’re in the market for a home warranty, you’re the type of homeowner who would benefit from one — more on that in our comprehensive guide to home warranties — and you’re in its coverage area, First American should definitely be included in your list of potential providers. It offers great basic coverages even if its more advanced protections can get a little pricey, and it will protect systems and appliances that other warranty companies won’t. First American might not ultimately be your first choice, but it is absolutely worth checking out.
While your lender requires you to carry homeowners insurance, there is no such requirement for home warranties. Purchasing one is completely up to the homeowner’s discretion.
First American Home Warranty has been in business for over 35 years and has a great reputation in the industry. Its protections are comprehensive and relatively affordable.
First American’s basic coverage is pretty standard in terms of costs, but if you add on coverage or opt for the Premium service package, it can get a little expensive.
If you purchase a warranty from First American today, your coverage will start in 30 days.
First American is one of the few home warranty companies that include minor roof repairs in certain coverage packages.