What is a Home Warranty?

 

Protection of your largest investment can be imperative. A home protection plan can be considered a peace of mind warranty to a new homeowner. These service contracts are purchased to repair or replace major systems in major home systems or appliances. After the purchase of a home warranty, local firms are then subcontracted to handle home repairs.

These policies do vary and are only offered for a specific amount of time. Warranties are prepaid yearly and can be renewed. Coverage for items and systems in a home may include heating and air systems, appliances, plumbing and electrical. Builders may offer these warranties to also include construction and workmanship.

It is important to check your policy for specifics in coverage.  Additional coverage can be purchased for other items. It is important to remember that items are generally covered under normal wear and tear conditions. Examine all loop holes in your policy and ask questions before the purchase.

A home warranty is invaluable to first-time homebuyers with no experience in maintenance. Most home warranties are purchased when buying a new home.

Home Warranty Cost

Typical costs of home warranty range from $250-$600 depending on covered items.  Companies run specials throughout the calendar year to include additional coverage for the same price as general coverage.  These policies are prepaid and can be renewed yearly like other protection plans.

Home Warranty Coverage of Items

General policies may include the following items.

  • Heating and air/furnace
  • Water heater
  • Dishwashers
  • Doorbells
  • Ceiling Fans
  • Garbage disposal
  • Ductwork
  • Plumbing backups
  • Electric
  • Ovens
  • Stoves
  • Telephone wiring
  • Garage door openers

Home warranties do not cover

  • Pools and hot tubs unless purchased separately
  • Faucets
  • Preexisting conditions
  • Fees for permits
  • Cost to haul old items away from premises
  • Sprinkler systems
  • Some systems that are not up to code

Home Warranty Steps of Repair or Replacement

If an appliances or home system stops working, the homeowner calls the warranty company.

Then a provider company makes an appointment for repair.

The provider company will fix or replace the system or appliance

The homeowner then pays a small service fee of less than $100 in general.

 

Home Warranty Companies can deny the following

  • Code violations
  • Improper maintenance
  • Improper installation
  • Unusual wear and tear

If your claim is denied, call the sales representative or the third party professional that provided the insurance. Work with that professional as well as the home warranty company until resolution.

A home warranty can be well worth the cost.  Always compare policies before purchase for coverage and cost.