Home warranty

What is home warranty insurance?

Home warranty insurance helps with the cost to repair or replace covered major home components and appliances when they break due to normal wear and tear. Home warranty insurance provides discounted repairs and replacements for what’s covered.

What does home warranty cover?

Home warranty insurance coverage varies by carriers. Generally, coverage includes major home systems and components like furnaces, HVAC systems, plumbing, electrical systems, and major appliances, such as washer/dryers, refrigerators, and other kitchen appliances. Coverage typically is limited to components that break due to normal wear and tear and not to poor maintenance. What constitutes “normal wear and tear” could be tricky, and what the carrier considers is poorly maintained might differ from what your definition is. Coverage may also include exclusions and dollars limits for covered items each year. See our individual carrier reviews for details on what carriers cover, exclude, and limit.

What types of homes are covered?

Most carriers cover single-family homes (including manufactured homes), new construction homes, condominiums, and townhomes under 5,000 square feet. Coverage is for occupied, owned, or rented residential property. Properties used for commercial and business purposes are not covered. Shared appliances with other home units are also not covered.

How does home warranty insurance work?

You enter into a contract (generally one year) for the duration of warranty coverage. You may renew your agreement after the end of the contract. During this coverage period, when something that’s covered breaks, you request for a professional contractor that the carrier has engaged with to come to your home to check out and repair the broken component or appliance. Depending on the issue, the repair might require a future visit if a component needs to be covered or a component might be completely replaced.

Generally, you are limited to the contractors that the carrier partners with. Some carriers might let you choose your own contractor or among their contractors. A benefit to the carrier selecting the contractors for you is that you don’t have to find your own. Each visit to your home comes with a pre-set service fee that you agree to in your contract. Depending on the issue, there might be additional costs.

What’s the difference between homeowner’s insurance and home warranty insurance?

Homeowner’s insurance generally covers damages due to major events, such as fires, thefts, natural disasters, or water damages. Home warranty insurance helps with the cost of repairing and replacing major home components and appliances.