Have you ever had the experience of multiple things going wrong at once? This is particularly common in homes, when several appliances of systems like electrical or HVAC suddenly give out around the same time. The reason for this is that when homes are built, they put these machines in at the same time and they tend to have similar lifespans. That is why many people who have homes older than eight years buy home warranties. This article will explain how home warranty companies work and how to find the best home warranty company.
What Are Home Warranties?
Home warranty plans cover service, repairs and replacement of major home appliances and systems. Like with any type of insurance, you would pay a monthly premium, whether or not anything needs to be fixed. If an appliance or system breaks down, you would make a claim and the home warranty company will send out a service technician to your home. Some companies have their own service techs on staff, but most contract with several local providers.
The service technician will look at the issue and determine if the cause of failure was related to a failure to maintain the item or use it as intended, in which case it would probably not be covered. If there is a mechanical, electronic or other covered failure, the technician will either make the repair or determine that the item needs to be replaced.
If replacement is ordered, the home warranty company would either send you a check to buy a replacement item or provide you with a new replacement item. This can be particularly useful when a major appliance or system needs to be replaced, costing a thousand dollars or more, such as a refrigerator, high end washer or dryer or air conditioner compressor. Service visits usually entail a co-pay of a fixed amount, which is payable to the repair company.
What Do Home Warranty Plans Cover?
Each home warranty company has different policy coverages; to find out what it covers, you can look at the website and then once you get a home warranty quote, you can read through the policy documents for details. However, most home warranty companies cover the following:
- Interior plumbing
- Water heater
- Air conditioner (sometimes optional)
- Oven, range or cooktop
- Refrigerator (may exclude icemaker)
- Garbage disposal
Some home warranty companies offer plans that only cover certain systems or just appliances. This may be a good option if, for example, you have just remodeled your kitchen with all new appliances but live in an older home that has not had its systems upgraded. New appliances are usually covered by a manufacturer’s warranty for a certain amount of time.
Most policies allow for add-ons of optional coverage for an additional fee. This may include:
- Pool or spa equipment
- Sump pump
- Well pump
- Septic system
- Additional air conditioning or cooling units
- Additional refrigerators or ovens
- Freestanding ice machines
- Trash compactors
- Ceiling fans
- Jetted bathtub motors and pumps
- Limited roof repair
- Pest control
For example, Homeshield of America (American Home Shield) policy provides homeowners with a choice of three plans: ShieldSilver, ShieldGold and Shield Platinum. The lowest plan, ShieldSilver, covers just the major home systems, including:
- Built in exhaust, vent and attic fans
- Main breaker and fuse panel box
- Doorbells and chimes
- Interior electrical lines
- Ceiling fans
- Garage door openers
- Interior plumbing lines
- Faucets and valves
- Whirlpool tub motor and components
- Water heaters
Their next plan, ShieldGold, covers all of that plus:
- Kitchen appliances (refrigerators, ranges/cooktops, ovens, dishwashers, built-in microwaves, garbage disposals and instant hot/cold water dispensers
- Laundry appliances (washers and dryers)
- Appliance replacement up to $3,000 each
The highest plan, ShieldPlatinum, covers everything in the gold plan plus:
- Roof leak repair up to $1,500 per year
- Appliance replacement up to $6,000 each
- Free HVAC tune up
- Unlimited air conditioning refrigerant
- Coverage for code violations and permits up to $1,000
They have add-on coverage for home electronics and entertainment products and pool and spa equipment.
Homechoice warranty (Choice Home Warranty) has two plans, the total and the basic. Both plans cover both systems and appliances, but the basic has exclusions for some appliances including refrigerators, washers and dryers as well as air conditioning systems. They have add-on coverage for pool and spa equipment, central vacuum, second refrigerators, well pumps, limited roof leak repair, a stand-alone freezer, sump pump, septic system and septic tank pumping.
How to Find the Best Home Warranty Company for You
The first step is to go online and look up reviews of the best homeowner warranty companies. This will show you the companies that are rated highest by customers and reliable reviewers like Consumer Reports.
Then see which of the top companies offer service where you live. Some home warranty companies are nationwide such as American Home Shield and Choice Home Warranty, while others are local providers. Local home warranty companies often have their own service technicians, which gives them more accountability, but they also tend to be smaller so it may take longer to schedule your appointment.
Once you have narrowed it down to three to five companies, you can look at each company’s website to see what plans they offer and what systems, appliances and other items are covered in each. The best way to save money is by only getting a plan that covers the things that are relevant to you. For example, if you do not have a pool or spa, then you do not need a plan that includes that kind of coverage, as long as the plan covers the things your home has. Also, you may be fine with excluding certain appliances if they are new and under a manufacturer’s warranty since that will take care of any needed repairs.
Then, once you choose a plan that looks good, you can fill out your information for a couple of companies and get home warranty quotes online. They will usually send the quote to you by email and you can call the company if you have any questions. If it is hard to get in touch with someone at the company, this may be a sign that their customer service is not good. If your questions are answered to your satisfaction and the price and coverage look good, you can go ahead and sign up with that provider.
There is usually a waiting period of at least a few weeks before you are able to make a claim. That is to prevent homeowners from signing up for the home warranty service only when they already have something that needs repair.