A home warranty provides you with financial protection against unforeseen and potentially expensive home repairs. Buying a home often leaves a gaping hole in your finances after the first couple of months – the last thing you want to worry about is how to overhaul the HVAC or washing machine three weeks after you move in.
Interestingly, the annual costs of a home warranty insurance often pale in comparison to the costs of replacing many home systems when they eventually go out of commission. This piece provides a guide that can help you determine if it makes sense to buy a home warranty.
Here’s what you can expect your home warranty to cover
A home warranty helps you cover the cost of repairing or replacing home systems when they break down due to regular wear and tear. You can typically expect your warranty plan to cover your plumbing system, plumbing faucets & fixtures, central home heating system, garbage disposal systems, and interior electrical systems. The warranty also covers both the cost of any spare parts needed to fix the damaged system and the warranty also covers the service charge for the repair and installation by a technician,
Here’s what you shouldn’t expect it to cover
As mentioned earlier, a home warranty typically covers the cost of fixing or home systems and appliances that become damaged due to regular use. Hence, your warranty is not likely to cover structural defects on your property. If you have cracks on your wall, sinking foundations, or a leaking roof after a storm – your warranty company won’t be liable, and you’ll have better luck contacting your home insurance company.
If you want to buy a house and you order a home inspection, it might interest you to know that the warranty company won’t be responsible for fixing issues discovered during the home inspection. The warranty company considers such issues to be pre-existing issues and your plans only cover incidents that happen after you might have purchased your warranty. You may want to ask the seller to fix any issue discovered during the home inspection.
A standard home warranty won’t typically cover the cost of repairing and replacing household appliances such as fridges, cookers, and air conditioners. However, if you are willing to pay more for extended coverage, you can also get appliance insurance to cover home appliances and gadgets such as your dishwasher, air conditioner, fans, and refrigerator.
2 reasons homeowners should buy a home warranty plan
The first reason a homeowner should consider getting a warranty is that it saves them from going through the laboriously slow process of finding and hiring a reliable contractor. Many homeowners simply don’t have the expertise to screen different contractors to single out the contractor that will offer them excellent service at fair prices.
If you are new to a neighborhood, you probably won’t know the reliable contractors, and you won’t know if they are billing you fair prices or not. More so, you may have a hectic schedule that makes it tough for you to start hunting for a dependable contractor.
With a home warranty, you don’t need to go through the motions of hiring a contractor. You only need to contact the warranty company about the damage – and the warranty company will do the heavy lifting of sending one of their pre-approved contractors to come over to your house.
The second reason you should seriously consider buying a home warranty is that it can help you to be more in control of your expenses if you are trying to be financially responsible with budgets. You can’t predict when something will go wrong with a system component in your house. If you don’t have a home warranty plan, you’ll end up outspending your budget, dipping hands into your savings, or borrowing money to make up the difference.