What a Home Warranty Policy Can Offer Homeowners and Landlords
You just purchased your dream house or moved into the perfect rental along with the elegant décor that turns your house into your home. It has been a few months and everything is unpacked and placed in its designated spot. However, within a few months of moving in, you get hit with a costly and unexpected expense when your heater blows out during the winter.
With a new mortgage payment and a limited amount in savings, you're looking at numerous financial options on how to pay for this unexpected expense. Had you purchase a home warranty plan, this expense - as well as any major systems and appliances that may need repair or replacement in your home - would have been covered.
What Types of Home Warranty Plans are Available?
Home warranty plans are usually broken down into appliance plans and systems plans. Some will simply be called Appliance and Systems plans, while others may have names such as Gold, Platinum, etc, though you’ll be able to tell which is which. Most home warranty companies offer a Comprehensive, or Total, plan that combines appliances and systems.
What Does a Home Warranty Include?
Home warranties typically include coverage the following major appliances and systems:
- Central air conditioning systems
- Central heating systems
- Interior electrical systems
- Ranges, ovens, and cooktops
- Built-in microwaves
- Water heaters
- Plumbing systems
- Garbage disposals
- Washers and dryers
- Garage door openers
- Roof leaks
When Do You Need a Home Warranty?
Home warranties are offered to all homeowners, both new and existing. Typically, home warranty plans are offered to the home-buyer when they are purchasing a new home. However, if the buyer decides not to purchase home warranty insurance simultaneously with their home purchase, then they can secure a home protection plan at a later date. There is no time restriction as to when a homeowner can decide to purchase a warranty plan.
Cost Involved with a Home Warranty Plan
Typical home warranty plans cost anywhere between $350-500 per year, or $45-60 per month, which can be paid in a lump sum amount during the purchase of a new home. This lump sum payment would be collected at the time closing costs are due for the newly purchased home. However, the seller, real estate agent or a family member or friend can purchase home warranties on behalf of a home-buyer. If a home appliance insurance claim is filed then the homeowner may be responsible for paying a service fee or deductible that typically ranges from $50 to $100. Please note, home warranty companies have different contract agreements, therefore fee amounts may vary.
Home Warranty Process
Filing a claim is a simple process. Prior to filing, review your insurance contract to verify the item that you need to repair or replace is covered under your plan. Next, complete the following steps:
Contact your home warranty company to file a claim
- The warranty company will review their home warranty plans to verify that you have a plan that covers the item in question
- The warranty company will schedule an appointment for you with a local contractor
- The contractor will diagnose the situation and makes a recommendation to repair or replace the item in question
- Repairs and replacements will be carried out
- You pay a cost in the form of a service fee to the warranty company
How to Choose the Best Home Warranty Plan for You
As there are many providers to choose from that have a variety of plan options, the best home warranty companies depend on how they can meet the needs of your home. The best way to select the right home protection plan for you is by doing your research on what each company has to offer.
Want to learn more before choosing? These in-depth reviews are packed full of information on the top home warranty providers. Once you've selected the plan that best fits your needs, you'll join the many homeowners that have peace of mind because they are protected by one of the top home warranty companies.