A home warranty is a policy that a homeowner purchases that covers the cost of replacing or repairing appliances and systems in a home. A warranty is often purchased when someone buys a home, and it protects the homeowner from unexpected expenses with major appliances and installations. If you think you may benefit from having a home warranty, keep reading to find the answers to some common home warranty questions.
What is Covered?
Home warranty companies, such as 2-10 HBW, generally cover major appliances and systems. This includes heating, ventilation, and air conditioning (HVAC), as well as electrical and plumbing systems. Kitchen and laundry room appliances, such as stoves, ovens, refrigerators, dishwashers, washers, and dryers are also commonly included.
To Fix or Replace
If an appliance or system can be fixed, the technician will fix it. The home warranty will pay the cost of the repair minus the service fee. If it will cost more to repair than to replace, the appliance will be replaced with an item of similar size and function. Only items that are mentioned in the policy will be covered. If the damage is due to neglect, natural disaster, accidents, or theft, it will not be covered. Often homeowners insurance will then cover the loss.
Home Warranty Vs. Homeowner’s Insurance
A home warranty covers appliances and systems in both used and new homes. Some plans cover only appliances, some only cover systems, and some cover both. It is often possible to also get add-on coverage for things like septic tanks and pools. It is important to note that only items listed in the warranty are covered. Sometimes, repairs can be denied due to a lack of maintenance or improper installation.
A homeowner’s plan covers the property and belongings in the property due to a natural disaster or peril, such as a fire, windstorm, hail, or theft. It also provides liability protection against lawsuits for property or personal damage that your property has caused to others. It can also include living expenses to pay for accommodations and food if you cannot live in your residence for some time.
Cost of a Home Warranty
There are two types of fees that are assessed with a home warranty. The first is an annual fee, usually between $350 and $1100, which can often be paid in installments. The second fee is called a service fee. This is a fee that is paid each time a repairman is called to fix an item, and it usually ranges from $55 to $150. These fees vary from one company to the next, and usually, if one fee is high, the other is lower. For example, if the annual fee is $1100, the service fee is typically less expensive.
Is a Home Warranty Worth It?
Even though there is usually an inspection when purchasing a home, you do not always know the condition or history of the appliances and systems in a home. Buying a home warranty for the first year of homeownership is common because it guarantees that homeowners will not be burdened by many unexpected replacement or repair costs in their new home.
For a small fee, it is possible to have peace of mind when purchasing a home. You can rest assured that, if anything goes wrong, a service technician will be out and take care of the problem with only minor charges left for you to pay. It can be well worth the investment.