home warranty
As a homeowner, you want to protect your investment and ensure your home is in good condition. One way to do this is by purchasing a home warranty. In this article, we will explore a home warranty, what it covers, and the pros and cons of having one.
What is a Home Warranty?
A home warranty is a service contract that covers repairing or replacing major home appliances and systems due to normal wear and tear. Unlike homeowners insurance, which protects your home from covered perils, a home warranty covers general wear and tear. Home warranties are typically year-long, renewable plans that cover home systems and appliances when they stop working due to normal wear and tear.
What Does a Home Warranty Cover?
Home warranty coverage varies, but there are some standard coverages for appliances and systems you can expect from most home warranty companies. Here are some examples of what a home warranty may cover:
– Heating, ventilation, and air conditioning (HVAC) systems
– Plumbing systems
– Electrical systems
– Kitchen appliances, such as refrigerators, ovens, and dishwashers
– Laundry appliances, such as washers and dryers
– Garage door openers
– Ceiling fans
– Jetted bathtub motors and pumps
– Limited roof or pest control coverage
– Rekeying service
It’s important to note that coverage varies between home warranty providers, and some plans may offer more comprehensive coverage than others. Additionally, there are some common equipment malfunctions that providers almost always disqualify under home warranty coverage, such as cosmetic issues or damage caused by improper installation or maintenance.
Pros and Cons of Having a Home Warranty
Like any service, there are pros and cons to having a home warranty. Here are some of the advantages:
Pros
– Peace of mind: A home warranty can provide peace of mind, knowing that major home systems and appliances are covered in case of a breakdown.
– Cost savings: If a covered item breaks down, a home warranty can save you money on repair or replacement costs.
– Convenience: With a home warranty, you can make one call to the warranty company instead of finding a repair person on your own.
Cons
– Cost: Home warranties can be expensive, and the cost varies depending on the level of coverage you choose.
– Limited coverage: Home warranties may not cover everything you need, and the contract may have exclusions or limitations.
– Service quality: The quality of service provided by the warranty company may not be up to your standards.
A home warranty can be valuable for homeowners who want to protect their investment and ensure their home is in good condition. However, it’s important to carefully review the contract and coverage before purchasing a home warranty to ensure that it aligns with your needs and budget. As an insurance agent, I recommend analyzing a sample service contract before signing up for coverage to understand the extensive coverage for both the bundled packages and add-ons.
How to Choose the Right Home Warranty Provider
Choosing the right home warranty provider can be daunting, but it’s important to do your research to ensure that you’re getting the best coverage for your needs. Here are some tips to help you choose the right home warranty provider:
- Research the company: Look for reviews and ratings from reputable sources, such as the Better Business Bureau or Consumer Reports. Check the company’s website for coverage, pricing, and customer service information.
- Compare coverage: Ensure you understand what is covered and what is not covered under each plan. Look for a plan that covers the appliances and systems that are most important to you.
- Check the contract: Read the contract carefully to understand the terms and conditions of the coverage. Look for any exclusions or limitations that may affect your coverage.
- Consider the cost: Home warranty plans can vary in cost, so make sure you understand the pricing structure and any additional fees that may apply.
- Look for customer service: Choose a provider with excellent customer service and support. Look for a provider with a 24/7 customer service hotline and a responsive claims process.
How to Make a Claim on Your Home Warranty
If you need to make a claim on your home warranty, follow these steps:
- Contact your home warranty provider: Call your provider’s customer service hotline or submit a claim online.
- Provide details: Be prepared to provide details about the appliance or system that needs repair or replacement. You may need to provide photos or documentation to support your claim.
- Schedule a service call: Your provider will schedule a service call with a qualified contractor to evaluate the problem.
- Pay the service fee: You will need to pay a service fee, which is typically between $50 and $100, depending on your provider.
- Wait for approval: Your provider will review the claim and determine whether it is covered under your plan.
- Get the repair or replacement: If your claim is approved, the contractor will repair or replace the appliance or system.
What to Do If Your Claim Is Denied
If your home warranty claim is denied, don’t panic. Here are some steps you can take:
- Verify your coverage: Review your home warranty coverage to ensure the reasons cited for the denial comply with your warranty provider’s coverage terms.
- File an appeal: Your provider has an appeal process, often starting with a formal application or form. Submit the application and provide any additional documentation that supports your claim.
- Contact the Better Business Bureau: File a complaint with the Better Business Bureau. As BBB’s rating calculations include the number of unresolved complaints against a company, home warranty providers who value their reputation may seek to offer resolutions to customer complaints.
- Consider legal action: If all else fails, you may consider filing a lawsuit in a small claims court or regular court. However, it’s important to consult with an attorney first to determine if this is the best course of action.
How to Compare Home Warranty Plans
Comparing home warranty plans can be overwhelming, but it’s important to do your research to ensure that you’re getting the best coverage for your needs. Here are some tips to help you compare home warranty plans:
- Research the company: Look for reviews and ratings from reputable sources, such as the Better Business Bureau or Consumer Reports. Check the company’s website for coverage, pricing, and customer service information.
- Compare coverage: Ensure you understand what is covered and what is not covered under each plan. Look for a plan that covers the appliances and systems that are most important to you.
- Check the contract: Read the contract carefully to understand the terms and conditions of the coverage. Look for any exclusions or limitations that may affect your coverage.
- Consider the cost: Home warranty plans can vary in cost, so make sure you understand the pricing structure and any additional fees that may apply.
- Look for customer service: Choose a provider with excellent customer service and support. Look for a provider with a 24/7 customer service hotline and a responsive claims process.
- Compare quotes: Request quotes from at least three providers to compare costs and coverage options. Make sure you understand the differences in coverage and pricing between each provider.
How Much Does a Home Warranty Cost?
The cost of a home warranty can vary depending on the level of coverage you choose and the provider you select. According to ConsumerAffairs, the average cost of a home warranty ranges between $450 and $600 per year. However, This Old House reports that the cost of a home warranty can range from $644 to $737 annually for a one-year plan. MarketWatch reports that the average cost for a plan with one of their top-rated cheap home warranty providers is $50 per month, with an average service charge of $93.
When considering the home warranty cost, factor in your monthly or annual payment and the service call fee. Most providers offer a repair guarantee, so you aren’t charged a service call fee more than once during a specified period if a repair isn’t successful and a contractor has to return. Look for language in a contract about the length of this period (usually 30 to 60 days).
How Long Does a Home Warranty Last?
Home warranties are typically 12-month contracts, and many providers offer the option to renew the plan annually. However, the length of coverage can vary depending on the provider and the plan you choose. It’s important to carefully review the contract to understand the length of coverage and any renewal options that may be available.
Home Warranty vs. Homeowner's Insurance: What's the Difference?
Home warranties and homeowner’s insurance are important tools that can reduce the risk and potentially the financial burden of owning a home. However, they offer different types of protection. Here are the key differences between home warranties and homeowner’s insurance:
Home Warranty
– Covers service and repair or replacement of your home’s major systems and appliances, generally for one year.
– Issued by a home warranty company.
– Covers damage caused by normal wear and tear.
– Complements homeowner’s insurance by covering damage that homeowner’s insurance policies don’t.
Homeowner’s Insurance
– Provides financial protection in case of a disaster or accident.
– Insures a home’s structure and belongings in case of a “known peril” listed in the contract, such as weather events, fires, or floods.
– Required by mortgage or home equity lenders.
– Covers damage caused by unexpected events that lead to damage.
Tips for Maintaining Your Home to Avoid Warranty Claims
Maintaining your home is important to avoid warranty claims. Here are some tips to help you maintain your home:
- Regularly clean and maintain appliances and systems: Regular cleaning and maintenance can help prevent breakdowns and extend the life of your appliances and systems.
- Address issues promptly: If you notice an issue with an appliance or system, address it promptly to prevent further damage.
- Follow manufacturer’s instructions: Follow the manufacturer’s instructions for using and maintaining your appliances and systems.
- Schedule regular inspections: Schedule regular inspections of your appliances and systems to identify potential issues before they become major problems.
- Keep records: Keep records of maintenance and repairs to provide to your home warranty provider if needed.
How to Cancel a Home Warranty
If you need to cancel your home warranty, follow these steps:
- Review the contract: Review the contract to understand the cancellation policy and any applicable fees.
- Contact the provider: Contact your home warranty provider to request cancellation.
- Provide documentation: Provide any documentation the provider requires to cancel the contract.
- Pay any fees: Pay any cancellation fees that may apply.
- Confirm cancellation: Confirm that the contract has been canceled in writing.
How to Renew a Home Warranty
To renew your home warranty, follow these steps:
- Review the contract: Review the contract to understand the renewal policy and any changes to coverage or pricing.
- Contact the provider: Contact your home warranty provider to request renewal.
- Provide payment: Provide payment for the renewal.
- Confirm renewal: Confirm that the contract has been renewed in writing.
Understanding the differences between home warranties and homeowner’s insurance is important to ensure you have the coverage you need when needed. Maintaining your home can help prevent warranty claims, and if you need to cancel or renew your home warranty, follow the steps outlined by your provider to ensure a smooth process.