A home warranty is a great money saving tool for homeowners, protecting against natural wear and tear on their systems and appliances. However, choosing the right provider for your needs is key. Extended appliance warranties are even better as it provides coverage beyond the initial time period.

Research each provider’s plans, pricing, and terms and conditions. One effective way to compare providers is by reading sample contracts.

Coverage

Home warranties provide financial protection against system and appliance breakdowns that occur as a result of normal wear and tear. They differ from home insurance policies, which offer coverage against damage caused by certain natural disasters.

The most common home warranty packages include heating, cooling and plumbing systems along with essential appliances like dishwashers and refrigerators. Some home warranty providers also cover garage door openers, septic systems and pools for an additional fee.

When selecting a home warranty plan, look for plans with flexible coverage options and generous annual limits. Some home warranty companies have monetary limits per system or appliance, while others have a set amount for the entire contract year. Additionally, some companies offer guest medical payments and additional living expenses to help homeowners manage costs when they experience a covered peril that renders their home uninhabitable. This type of coverage is often more affordable than purchasing a separate policy for these types of incidents.

Exclusions

When you purchase a new electronic device or a car, you’re often offered a warranty at the time of sale that guarantees the product against damage and defects. A home warranty is similar, protecting homeowners from high expenses when systems and appliances break down.

A comprehensive home warranty package covers all of the essentials in your house, from the kitchen appliances to your heating system and air conditioning. It also provides coverage for smaller items such as doorbells and garage doors. In addition, many providers offer a combination plan that includes both systems and appliances.

A home warranty can be beneficial for both buyers and sellers. However, it’s important to understand what is and isn’t covered. Many contracts have limitations and exclusions, which may include preexisting conditions, improper maintenance, and consequential damages. Also, many plans do not cover ancillary costs like hotel bills for when the home needs to be repaired or replaced. However, these types of repairs are typically covered by homeowner’s insurance.

Claims process

Home warranty companies offer a wide range of plans, but they can also deny claims for many reasons. It’s important for homeowners to carefully assess their needs and compare alternatives that may provide more control over repair decisions or savings.

A good home warranty company will provide a simple claims process for homeowners to follow when their appliances or systems break down. You can usually submit a claim online or via phone, and the company will dispatch a contractor to make repairs as soon as possible.

You must pay a service fee and any uncovered expenses, but the company will cover most of the rest of the cost of the repair or replacement. Some home warranty providers also offer add-on coverage options, such as pool coverage or plumbing maintenance. These can be worth the extra cost if they save you money in the long run. It’s also a good idea to stay up-to-date on your coverage and know what to do if you encounter any issues.

Reputation

It’s important to choose a home warranty provider with an excellent reputation. Ask your real estate agent or mortgage lender for recommendations, and look for online reviews of providers. You should also compare pricing and plans to find the best value for your money. Additionally, consider whether a specific provider offers unique add-ons that may be beneficial for your home, such as roof leak protection or plumbing stoppage coverage. A comprehensive home warranty package is a great way to limit your out-of-pocket expenses and protect your budget from unexpected repairs. It is a cost-effective alternative to setting aside money for emergency repairs in a rainy day fund.

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