Compare Home Warranties
Home Warranties...The Basics
Home warranties are supposed to cover what your homeowners insurance does not. While your home insurance will take care of damage to your dwelling and it’s contents in the case of an accident, disaster or calamity, it will not cover things that just break down. Theoretically, this is where a home warranty steps in. It is an annual contract with a premium just like your homeowners and a service fee/deductible issued for every claim.
Home warranty companies typically offer 3 plans: appliance, systems, and combo. Appliance plans cover things like your refrigerator and washer & dryer, while systems plans cover elements in your home’s structure like the air conditioning and water heater. Most companies offer coverage of the same basic elements, however some feature more extensive coverage than others. Still others offer items in standard coverage that another company would charge as an additional item.
The way it works:
Your appliance or system stops working, you call your home warranty provider, they send you out a contractor from their network, you pay a service fee, the provider approves the work and the contractor fixes or replaces the appliance or system.
At face value it’s simple, however, as we shall see, the home warranty field is not without controversy. It has an iffy reputation that stems from a disproportionately large amount of customers who have had bad experiences. They mainly report companies not paying claims due to technicalities in contracts, and long wait times for contractors to show up. Add to this the fact that several home warranty companies have been the subject of litigation in the past and have been forced to even pay damages due to deceptive business practices and you’ll get an idea why many view the entire industry with caution.
However, if you deal with a reputable company, and above all do the research to find out what the company covers and doesn’t cover, a home warranty can be an extremely valuable resource, particularly if your systems and appliances are approaching the 10+-year-old mark.
Who needs a home warranty?
A home warranty is a good idea if you don’t have a lot of money in savings for sudden accidents and repairs. With a home warranty you’ll pay a deductible or service fee aside from your yearly premium. You’ll have to deal exclusively with the company’s contractor network. In this way the home warranty company acts as a kind of buffer and will appeal to you if you don’t relish the idea of tracking down and communicating with the right contractors for a particular job. Home warranties are also good if you are not particularly handy, or simply like having the peace of mind that everything in your house is covered in case of an emergency.
A home warranty might not be the best idea if you’ve purchased a home with poorly cared for appliances and systems. It’s entirely possible that you could make a call only to find out your particular appliance or system is excluded because it has a “pre existing condition.” Also, if your house is a brand new construction, and everything in it is new as well, you have to take into account how long it will be before a given item will typically need service. You may be paying hundreds for years for no reason. In these situations it may be ideal to be sure you are properly maintaining your appliances and systems for 10 years and then get the home warranty as that is typically the time things start to break down.
When Can You Expect An Appliance or System to Break Down?
How we rate them
Our staff conducted extensive research of the home warranty marketplace. We consulted with industry leaders, talked with customers, evaluated online reviews, talked with customer service people, and purchased home warranties ourselves. We decided upon 5 criteria by which to judge home warranty providers:
How we Compare Home Warranties
Full Home Warranties Comparison
What is a home warranty and how is it different from homeowner insurance?
A home warranty is a service contract that will help repair or replace systems (like plumbing, heating, electrical) and appliances (like dishwashers, ovens, garbage disposals) in your home, whereas a homeowners insurance policies cover damage to your home.
Not all home warranties are the same and not all systems and appliances are covered, so make sure you read the policy carefully before you make the purchase. If the coverage you need is not included in the basic warranty, it may be worthwhile to look into an enhanced warranty.