home warranty coverage

What Do Home Warranty Plans Cover?

Home warranties can be an ideal solution for people who don’t want the hassle of dealing with home repairs — or simply don’t have the time to handle them. Warranties are purchased through companies and usually require a minimum one-year contract. If you’ve been thinking about purchasing a home warranty, this information should help you with your decision.

What’s a Home Warranty?

Home warranties are usually purchased to ensure all major systems and appliances in the home are kept in working order — either by making repairs or installing replacements. Frequently, home sellers will purchase home warranties that will make some buyers more comfortable knowing they have coverage for a year.

How Do Home Warranty Plans Work?

Each warranty service may work slightly different, but most offer a variety of plans to suit the needs of each customer. Home warranty buyers can review plans online or discuss services over the phone. Typically, after deciding on a plan, the buyer is responsible for a lump sum payment upfront to begin services.

When considering home warranty plans, you should understand that most contracts cover specific items — the service company will only cover these items provided they have been properly maintained. In most situations, items that aren't in good condition at the time you purchase the warranty aren’t covered.

Normally, home warranty companies cover any home regardless of how old it is. There are also no brand restrictions for appliances, which makes it easier for consumers.

To use the warranty service, the homeowner simply places a call to their coverage provider. They send out a trained and insured repairman to determines if the item should be fixed or replaced.

How Much Do Home Warranty Plans Cost?

Companies can vary significantly in what they charge homeowners for their plans and services. However, most service contracts run anywhere from about $250 to $500 per year.

In addition to paying the premium, consumers are responsible for paying a service charge every time a repair person is called. Service calls may range from $75 to about $100.

What Do Home Warranties Cover?

Most service plans cover major home systems like plumbing, heating, electrical systems and air conditioning. Basic plans usually include items such as:

  • Refrigerators
  • Freezers
  • Ovens and ranges
  • Microwaves
  • Dishwashers
  • Garbage disposals
  • Trash compactors
  • Ceiling fans
  • Water heaters
  • Toilets
  • Sump pumps
  • Humidifiers

What Isn’t Covered by a Home Warranty Plan?

When purchasing a home warranty plan, you should receive a copy of the plan and a contract. Either one should specify, in detail, exactly what items are covered in your particular plan. Certain items may not be offered as part of a basic service plan, like these listed below (however, some companies do provide coverage if you’re willing to pay extra):

  • Pools
  • Spas
  • Sprinkler systems
  • Septic systems
  • Home entertainment systems
  • Washing machines
  • Dryers
  • Ice makers
  • Well pumps
  • Garage door openers

Home Warranties Aren’t Insurance

Don’t confuse a home warranty with homeowner's insurance. Warranties cover systems and appliances that break or fail to work. Your homeowner's insurance covers items that may be damaged or destroyed due to a fire, theft or a natural disaster.

Purchasing a home warranty can be a great way to simplify repairs around the home. It makes many people feel secure knowing they have a service that’s professional and readily available. 

Last Updated: June 13, 2016