Home warranties cover unexpected and costly service repairs or replacements of major home appliances. Major appliances can include your refrigerator, washer, and dryer, among other appliances and home systems. Although there are many home warranty companies, each one offers different home warranty coverage options. Below you'll find key factors to consider as you choose a home warranty service provider to help you find the best home warranty company for you.
When comparing home warranty companies, you'll find that there is a wide range in annual fee costs. Some home warranty companies charge one comprehensive, annual fee, while others charge a lower annual fee but add in extra fees throughout the year. Don't assume that one company is a better choice just because it has a lower annual fee.
Take note that some home warranty companies will have different pricing based on your state. When evaluating cost, make sure you're looking at your state-specific cost, not the company's average cost across all states.
Be aware that most home warranty companies charge a trade call service fee every time a technician visits a customer's home, regardless of whether or not the item that needs repairing has been previously assessed. You'll owe a service fee even if the damage or problem isn't covered by your home warranty.
Most often these service fees must be paid at time of service and don't contribute to the repair cost. Failing to provide immediate payment could result in the suspension of the warranty coverage. Keep this in mind if you can't guarantee the ability to pay repeat service fees, or simply if that is something you don't want to deal with altogether.
It is important to understand the specific coverage offered and any eligibility requirements regarding the condition of your appliances. There are usually two types of coverage plan options, generic overall coverage plans and customizable coverage plans:
Home warranty companies typically have a coverage limit for each covered appliance or system. The coverage limit is the maximum a company will pay towards covered damage.
In some cases, customers prefer not to have a home inspection because it makes the transaction process a bit more complicated. Home inspections can have additional costs, so some customers prefer to save money up front and go with a company that doesn't require a home inspection.
However, getting a home inspection could give you peace of mind and help you determine what appliances and systems will be covered in your home.
Finding a home warranty company with good customer service and dedicated workers is essential.
A large part of home warranty coverage is the customer service and maintenance assistance customers receive from the company. Some warranty companies have faster representatives and technicians that respond to claims and service requests. Ask yourself the questions below as you evaluate home warranty companies:
Many assume that home warranty companies actively look for ways or loopholes to deny a claim, and while that has and does occur, there are some valid reasons for why a company would deny a claim:
Home warranty companies don't usually cover all systems and appliances under all circumstances, especially if they have pre-existing conditions or problems. Thus, it is important to read and understand what is included in your contract. If you have any specific questions about your contract and coverage, speak with your home warranty company.
You may be more eligible for one home warranty plan over another, so the research on claims and coverage can be essential. Most of the time this information is laid out in easy-to-find sample contracts, but if not, talking with a home warranty representative may be helpful.
Customer reviews offer valuable insight on the customer experience. Pay attention to the cumulative review data like average star ratings and ratio of positive reviews to negative reviews. This data offers a quick snapshot of how well a home warranty company treats its clients, particularly if the company's review count is high.
American Home Shield and Choice Home Warranty have some of the highest review counts on BestCompany.com with over 10,000 reviews. Although most companies listed have fewer, you'll find companies with several thousand or a few hundred. The review data on these companies will still help you gauge the customer experience.
In addition to considering the aggregate data, spend time reading home warranty reviews. Since companies can change over time, you'll get a better read on the company if its reviews are recent. As you read reviews, you'll learn what the company does well and what problems people have encountered with the company.
You won't find a company without negative reviews. However, note the ratio of negative reviews to positive reviews and use the information in negative reviews to decide what questions to ask before you purchase and be aware of potential issues that may arise.
Many potential home warranty buyers are real estate agents wanting to make sure their homebuyers are covered. If you're a real estate agent, consider what home warranty companies offer such packages and if they meet your needs.
Having a home warranty can help close a sale and some home warranty companies also offer real estate agents educational materials for no charge.
Understanding the difference between homeowners insurance and home warranties can help you determine if a home warranty is right for you.
Homeowner's insurance is an insurance policy that covers accidental damage done to your home — damage from fire, theft, and some natural disasters.
A home warranty is a service contract that will replace or repair the appliances you have in your home.
American Home Shield is currently the top-rated home warranty company.
Other top-rated companies include Choice Home Warranty, OneGuard, Landmark Home Warranty, and Elite Home Warranty.
A home warranty can lower your out-of-pocket expenses if an appliance or system in your home fails. If and when a covered appliance of system in your home malfunctions or fails, you submit submit a service claim with your home warranty provider and a technician will come to either repair or replace the appliance or system. For each claim you are required to pay a service fee (typically of $75).
Home insurance covers damage to property due to named disaster, such as fire, hail, wind, or theft. If any one is injured on your property, home insurance would also cover these circumstances. A home warranty, on the other hand, covers only home appliances or systems that you own.
While a home warranty isn't required, it can provide you with peace of mind and protection against unforeseen home appliance and/or system repair expenses.
Although coverage options vary based on warranty companies, most basic plan options include these major appliances and systems:
Many home warranty companies have customizable plan options, allowing the customer to add specific systems and appliances to a current plan. Customizable add-ons often include services for swimming pools/hot tubs, septic systems, well pumps, etc. Add-on services vary by warranty company, so check with specific companies to see if the chosen plan covers the options you’re interested in.
Yes, most home warranty companies offer coverage for other housing situations such as rental properties and condominiums. However, the coverage options and requirements may differ from regular home warranties, so be sure to inquire about the details.
Home warranty plans don't typically cover repair costs for water damage. Homeowners insurance is usually what covers situations such as water, fire, and wind-related damage. However, many warranty companies have relationships with companies that handle those hazards, so you could consider talking to a home warranty company about a recommendation for an insurance company that could assist you.
Prices vary based on the home warranty company and coverage selection — the annual average is approximately $400. However, this doesn't include the repeat service fees you often have to pay for maintenance calls. Talking with representatives from home warranty companies is the best way to find out exactly what your repair costs, service fees, and overall annual payments will be.
You can get an online quote with many home warranty companies.
The average contract length for home warranty coverage is one year; however, some warranty companies prefer month-to-month. After contracts expire, most home warranty companies allow you to renew your warranty plan if you want. Especially with companies that require a one-year contract, it is important to be absolutely sure about your decision before signing the contract. Look through the contract details, research the company, and check out the best home warranty companies before being locked into a contract and finalizing your decision. Be aware of the company’s cancellation policies — many companies offer a 30-day money back guarantee if you want to cancel their services.
Yes, most home warranty companies allow you to renew your home warranty after your contract ends. Some companies may be able to automatically renew your coverage.
Make note that some home warranty companies may not let you know when your plan is about to expire, so it is up to you to understand your contract and ask the warranty company if it offers coverage renewal. Some warranty companies even allow you to renew your coverage through your online portal on their website.
An important concern potential home warranty purchasers have is whether a certain warranty company has fast and efficient service response times. Although it varies based on the situation, the company, and the availability of service technicians, most service requests are responded to within 24 hours. The service contractor contacts you and schedules a time that works for both of you during normal business hours in the next few days. Although most warranty companies can be contacted 24/7 and you can file a claim online at any time, many of them will not actually provide service to repair or replace a broken system or appliance until normal business hours. Be aware that response times on weekends and holidays will most likely be different and take longer. Lastly, keep in mind that several companies allow you to request services online, eliminating the hassle of lengthy call wait times.
A home warranty claim may be denied for one of several reasons:
From home warranty company reviews on BestCompany.com, it appears that it is difficult to know when a company will or will not deny a service claim — some customers claim that everything was in order for their home warranty company to comply with servicing an appliance or system, but then their claim was still denied.
It can be wise to schedule a home inspection before signing a home warranty contract. Many home warranty companies don't require a home inspection to receive coverage, but this can help you know the current state of your appliances and systems before signing a contract. Thus, if one of your appliances was installed incorrectly, you'll know that before it breaks and before trying to file a service claim with your home warranty company.
Another way you can avoid a service claim denial is by carefully reading your home warranty contract, making note of exactly what is and isn't covered. Your contract will likely include other smaller or specific details about your plan that can be helpful to know.
If your service claim is denied and you feel that it was unjust, you can file an appeal with your home warranty company. When filing an appeal, be prepared to have specific documentation on-hand, including policy contracts and information.
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