Home Warranty Companies: Everything You Need to Know

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 Purchasing a home is a significant investment, and it is essential to protect that investment against unexpected repairs and replacements. Home warranty companies offer a solution by providing coverage for repairs and replacements of appliances and systems in your home. In this article, we will provide an overview of home warranty companies, how they work, and the benefits they offer. We will also discuss the top home warranty companies and what to look for when choosing a home warranty provider.

Table of Contents

  1. What are Home Warranty Companies?
  2. How do Home Warranty Companies Work?
  3. What are the Benefits of Home Warranty Coverage?
  4. What Does Home Warranty Coverage Include?
  5. What are the Top Home Warranty Companies?
  6. What Should You Consider When Choosing a Home Warranty Provider?
  7. How Much Does Home Warranty Coverage Cost?
  8. What Are the Limitations of Home Warranty Coverage?
  9. How to File a Claim with a Home Warranty Company
  10. Frequently Asked Questions (FAQs)
    1. What is the difference between home insurance and home warranty coverage?
    2. Are there any exclusions to home warranty coverage?
    3. How long does home warranty coverage last?
    4. Can I transfer my home warranty coverage to a new homeowner?
    5. Do I need to get a home inspection before purchasing a home warranty?

1. What are Home Warranty Companies?

A home warranty company is a service provider that offers coverage for repairs and replacements of appliances and systems in your home. These companies offer various plans, and each plan covers specific appliances and systems in your home. Home warranty companies work with a network of service providers, and when a covered appliance or system breaks down, the homeowner contacts the home warranty company, which then dispatches a service provider to repair or replace the item.

2. How do Home Warranty Companies Work?

When you purchase a home warranty plan, you pay an annual or monthly fee for coverage. The plan covers specific appliances and systems in your home, and when a covered item breaks down, you contact the home warranty company. The home warranty company dispatches a service provider to your home, and the service provider will diagnose and repair or replace the item, depending on the terms of your plan. You will pay a service fee for each service call, which is typically between $50 and $100.

3. What are the Benefits of Home Warranty Coverage?

Home warranty coverage offers several benefits to homeowners, including:

  • Protection against unexpected repairs and replacements
  • Peace of mind knowing that you have coverage in case of a breakdown
  • Access to a network of service providers
  • Convenience of not having to search for a qualified service provider
  • Cost savings compared to paying for repairs and replacements out of pocket

4. What Does Home Warranty Coverage Include?

Home warranty coverage varies depending on the plan you choose, but most plans cover appliances and systems such as:

  1. HVAC systems
  2. Plumbing systems
  3. Electrical systems
  4. Kitchen appliances (refrigerator, stove, oven, dishwasher, etc.)
  5. Laundry appliances (washer and dryer)
  6. Water heaters
  7. Garbage disposals
  8. Ceiling fans

It is important to review the coverage details of each plan carefully to ensure that it covers the appliances and systems you need.

5. What are the Top Home Warranty Companies?

There are many home warranty companies to choose from, and each has its strengths and weaknesses. Some of the top home warranty companies include:

  1. American Home Shield
  2. Choice Home Warranty
  3. First American Home Warranty
  4. Select Home Warranty
  5. Liberty Home Guard

6. What Should You Consider When Choosing a Home Warranty Provider?

When choosing a home warranty provider, there are several factors to consider, including:

  • Coverage: Make sure that the plan you choose covers the appliances and systems you need.
  • Cost: Compare the cost of plans from different providers and make sure you are getting the best value for your money.
  • Service providers: Check the provider’s network of service providers to ensure they have qualified technicians in your area.
  • Customer service: Look for a provider with good customer service and a reputation for resolving claims quickly and efficiently.
  • Exclusions and limitations: Review the plan details carefully to understand any exclusions or limitations to coverage.

7. How Much Does Home Warranty Coverage Cost?

The cost of home warranty coverage varies depending on the provider and the level of coverage you choose. The annual fee for a basic plan typically ranges from $350 to $500, while more comprehensive plans can cost $600 or more per year. Some providers offer monthly payment options, which can be more convenient for some homeowners.

8. What Are the Limitations of Home Warranty Coverage?

While home warranty coverage can offer significant benefits to homeowners, it is important to understand the limitations of coverage. Some common limitations include:

  • Pre-existing conditions: Home warranty companies do not cover appliances or systems that were already broken or damaged before you purchased the plan.
  • Neglect or misuse: If an appliance or system breaks down due to neglect or misuse, it may not be covered.
  • Age restrictions: Some providers have age restrictions on appliances or systems that they will cover.
  • Service call fees: You will be responsible for paying a service call fee for each visit from a service provider, which can add up over time.

9. How to File a Claim with a Home Warranty Company

If a covered appliance or system breaks down, you should contact your home warranty company to file a claim. The company will dispatch a service provider to your home to diagnose and repair or replace the item. To file a claim, you will need to provide your plan information and a description of the problem. Once the service provider has completed the repair or replacement, you will pay the service call fee and any additional costs that are not covered by your plan.

10. Frequently Asked Questions (FAQs)

1. What is the difference between home insurance and home warranty coverage?

Home insurance typically covers damage to your home and belongings caused by events like fires, storms, and theft. Home warranty coverage, on the other hand, covers repairs and replacements of appliances and systems due to normal wear and tear.

2. Are there any exclusions to home warranty coverage?

Yes, home warranty coverage typically has exclusions and limitations, which vary depending on the provider and the plan you choose. Common exclusions include pre-existing conditions and neglect or misuse of appliances or systems.

3. How long does home warranty coverage last?

Most home warranty plans last for one year, but some providers offer longer-term plans.

4. Can I transfer my home warranty coverage to a new homeowner?

Some home warranty providers allow you to transfer your coverage to a new homeowner, but this varies depending on the provider and the plan.

5. Do I need to get a home inspection before purchasing a home warranty?

While a home inspection is not required to purchase a home warranty, it can be helpful to identify any potential issues with appliances or systems in your home before purchasing a plan.

Conclusion

Home warranty coverage can offer significant benefits to homeowners by providing protection against unexpected repairs and replacements of appliances and systems in your home. When choosing a home warranty provider, it is essential to consider factors such as coverage, cost, service providers, customer service, and limitations of coverage. By understanding the benefits and limitations of home warranty coverage, homeowners can make an informed decision and protect their investment in their home.

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