Should You Consider a Home Warranty?

Obtaining home warranties can be an important safeguard against problems big and small for new homeowners. But remember, home warranties are not insurance policies. They are policies that provide service for repair or replacement of covered items such as appliances, heating and cooling systems, plumbing and electrical systems. The cost of a one-year standard policy is approximately $350-$500 depending on the type of home (single family, townhome, condo, duplex, etc.) with enhancements like coverage for pre-existing conditions, pools, etc. available for an additional $100-$300 per year. Service fees of approximately $100 are due at the time of the repair call. Home warranties can usually be renewed after the one year period has expired. It pays to review the policy being offered to make sure you understand what is covered and what is excepted. A buyer can purchase a home warranty for himself or ask the seller to purchase the home warranty as a part of the sales negotiation. Do not be afraid to ask your realtor for advice concerning the home warranty being offered. Neither realtors nor real estate companies are permitted to receive referrals from home warranty companies. You can also check on line for reviews of the various home warranty companies in which you are interested at such websites as home-warranty-reviews and homewarrantyreviews. You should also know that home warranty companies are regulated in all 50 states under the consumer protection laws.


What’s Covered?

What’s covered? Most home warranty companies offer a variety of plans with differing levels of coverage so be sure to read the details. The following is a list of general coverage for home warranties. Remember to review each policy to ascertain what is covered and what is excluded.


Basic coverage often includes:

  • Plumbing systems
  • Range/Oven
  • Dishwasher
  • Garbage disposal
  • Exhaust fans
  • Sump pump
  • Water heater
  • Ceiling fans
  • Heating and air conditioning systems
  • Electrical systems
  • Built-in microwave
  • Whirpool tub
  • Rekeying the entire house to the same key for a nominal charge


Enhanced coverage often available:

  • Pre-existing conditions
  • Washer/dryer
  • Refrigerator
  • Garage door opener
  • Pool
  • Spa
  • Well pump
  • Septic system
  • Stand alone freezer

Central vacuum system