There are several home warranty companies that offer protection from a variety of unexpected and unforeseen expenses. What happens if your furnace blows? What will you do if you need to replace your air conditioning unit?
Having home appliance coverage can help you prepare for these types of events and protect your bank account from taking a huge hit. However, it’s important to understand a plan’s coverage limits before purchasing a warranty.
Home warranty plans vary in the types of coverage they provide; some companies may offer warranties with different packages and add-ons, allowing you to customize your protection. However, most warranties cover the major components of large home systems, such as:
- HVAC (heating, ventilation and air conditioning)
- Hot water heater
Most home warranty companies also offer home appliance coverage, which may or may not be included in a standard warranty plan. Homeowners may need to purchase appliance coverage as an add-on. Regardless, many home warranties cover repairs or replacements for the following appliances:
- Garbage disposals
- Washers and dryers
- Ovens and cooktops
- Built-in microwaves
Many home warranty plans will only cover the cost of repairs on residential appliances. If you install commercial kitchen appliances, for example, your home warranty may not cover this type of expensive appliance.
Some home warranty plans extend coverage to other amenities for an additional charge. Depending on the company and warranty you choose, you may be able to add coverage for the following facilities:
- Septic pumps
- Well pumps
- Guest houses and rental units
So, what is not covered under a standard home warranty? Most home warranty companies offer several coverage plans with different levels of protection. Generally, the more coverage you need, the more expensive the plan. Furthermore, the more things you add on to a warranty, the more you typically pay for that warranty.
However, your home warranty usually will not cover the following (unless the plan allows you to add these types of coverage):
- Roof repairs
- Water damage from leaks
- Solar panels
- Rust and corrosion issues
While a home protection plan may not cover these structural amenities, homeowners’ insurance typically will. That’s why most homeowners choose to purchase a warranty – it acts as supplemental protection. Having both a warranty and insurance plan offers the most robust coverage possible.
It is common for home warranty companies to have dollar limits for each type of replacement. For example, the company may replace a refrigerator up to $3,500; if you wish to install a more expensive refrigerator, you must generally pay the difference.