Think about this scenario for a second: if something goes wrong with one of your big-ticket appliances or home systems, would you be able to have it fixed without it having a major impact on your home or finances?

That’s where a home warranty plan comes in.

Purchasing the best home warranty is a way to safeguard yourself from financial stress and inconvenience when a significant component of your home breaks down or malfunctions.

For instance, if your HVAC stops working, you can simply make one call to your home warranty supplier and arrange to get it fixed. Your home warranty provider will then arrange for one of their preferred suppliers to come out and perform the repairs. So, what does a home warranty cover? And how does it differ from homeowner’s insurance?

What Does a Home Warranty Cover?

Purchasing a home warranty plan means that repairs, parts, or replacements for your home’s critical components are covered. Usually, this includes plumbing, heating, electrical, air conditioning systems, and other major home appliances.

If a system or appliance specified in your home warranty plan malfunctions or breaks down, you can submit a service request to your home warranty provider. Your home warranty provider will then dispatch a contractor to come to your home to diagnose, repair, or replace the faulty system or appliance.

However, it’s important to note that only the systems or appliances specified in your individual home warranty plan will be covered. You can customize your plan to add other systems and appliances – such as trash compactors, freestanding ice machines, built-in microwaves, etc.

Different Types of Home Warranty Plans

The coverage that home warranty plans offer varies depending on the plan you choose. Typically, home warranty providers offer three types of plans – appliance plans, system plans, and combination plans.

Appliance Home Warranty Plans

Appliance home warranty plans provide coverage for most major home appliances – such as dishwashers, refrigerators, washing machines, dryers, ovens, and stoves.

System Home Warranty Plans

System home warranty plans provide coverage for your household’s critical systems – such as heating, smoke detectors, garbage disposal units, ceiling fans, doorbells, ductwork, plumbing, and water heaters.

Combination Home Warranty Plans

Combination home warranty plans cover your home’s appliances and systems. Combination home warranty plans are the most popular among homeowners, and they usually come with additional perks.

Some home warranty providers will allow you to customize your plan and decide which systems and appliances you want coverage for. Usually, home warranty providers also include additional optional coverage for other miscellaneous home items – such as a second refrigerator or hot tub.

Home Warranties vs. Homeowner’s Insurance

Homeowner’s insurance, on the other hand, serves a different purpose than a home warranty plan because it covers your property and possessions. Generally, homeowner’s insurance provides cover against vandalism, theft, and liability for injuries sustained on the policyholder’s property. Homeowner’s insurance also provides financial protection against natural perils – such as fire, hail, wind, and floods.

Ultimately, both homeowner’s insurance and a home warranty form a vital protection plan for your home, possessions, and property if something should go wrong.

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