The home warranty is a product that is meant to cover different aspects of your home and help you out financially if you need to make repairs. A home warranty is like a service and sometimes replacement contract on key items in your home. If you have a home warranty on your home, then you have a service contract to help if you need to do costly repairs or in some cases, if you have to replace contract specified items in your home.
Manufacturers warranties are similar in concept, except they cover specific appliances or items for a specified term, the home warranty applies to a selection of multiple items in your home depending on your contract. For example, some warranties will cover everything from HVAC systems, plumbing, fancy appliances, to equipment and their motors, depending on coverage options. You can choose from very basic home warranty coverage to very extensive coverage depending on your needs, budget and how much of a risk you think you might have.
What Is the Best Home Warranty?
The best home warranty contract would be the one that offers you the protection you need for your home. Before we review some of the features of home warranties and how to find the best one for your circumstance, let’s clarify how a home warranty is different than your basic home insurance policy coverage.
What is the difference between a Home Warranty and Home Insurance?
Home warranties and home insurance both cover unexpected circumstances. The difference is that in your homeowner policy there are exclusions about regular wear and tear and mechanical breakdown. If your dishwasher breaks down, or the air conditioning system fails, the actual replacement of those items or repair would not be covered although resulting damage may be covered in a claim, for example, if there was water damage.
What Is Covered By a Home Warranty?
Here are some examples of things that may be covered for servicing, replacement or malfunction in a home warranty program, remember every home warranty program is individually managed, so be sure and ask for the specifics of the program you are considering purchasing before you commit to the contract, these are just examples of what may be covered by different plans to help you shop for a good warranty:
Beware that each plan specifies details of what kind of service they are willing to provide if you get repairs, replacements, etc. You also want to find out if the warranty is limited by the age of the appliance, some warranties may specify that they only cover appliances 10 years and under, for example. Some plans exclude refrigerators.
It is important to ask as many questions regarding how to make a claim and what to expect before your purchase decision.