Home warranty or appliance protection plan is a service agreement that covers your household appliances and systems during breakdowns thereby protecting your budget. When an insured device malfunctions it is either repaired or replaced. There are various types of Home Protection plans available in the market today.
In case of an unexpected appliance/ system breakdown, you can open a claim by calling the customer support or reporting it online, following which the home warranty company sends a technician to fix the issue. Most companies have round clock customer service facility to process claims. Once the report is processed, contractor assistance will be scheduled as per your convenience.
Most basic plans cover major appliances and systems like heating, air conditioning, plumbing systems, electrical appliances, kitchen and laundry appliances or any other key units. For a detailed list, refer to What is covered by home warranty.
Some Standard coverage may also include appliances like-
Plumbing stoppages, toilets, sump pump, bathroom whirlpool motor pump, recirculating hot water pump, water heater, heating and duct work, telephone system, central vacuum system, garage door opener, ceiling fans, attic and exhaust fans, smoke detectors, doorbells, dishwasher, range, oven, cooktops, built-in microwave, instant hot water dispenser and trash compactor.
Warranty covers only those systems and appliances, specifically mentioned as covered in the contract and excludes all the others. The contract does not cover system or appliance failures that occur due to lack of maintenance, natural hazards, theft or other crimes.
Additional or optional coverage is the extra coverage you buy from a list of add-on items such as kitchen appliances like refrigerator, oven, washer/dryer, air conditioning, pool and spa equipment. Roof leak repairs are also available for purchase at an additional fee at the time of signing a contract.
Typical home warranty expenses are as follows:
Annual premium, which would be around $300 to $500 for basic appliance coverage and a service call fee per incident, which comes to around $40 to $70. This fee varies from company to company.
It depends. Generally the buyer pays the cost of a home warranty policy. However, the seller may buy a policy for the buyer to avoid certain liabilities that may occur after the closing a deal. You can also buy a policy on existing homes.
For sellers: Usually the coverage varies from company to company . Coverage begins when the enrollment form is received and continues through the listing agreement period.
For buyers: Coverage begins at closing (when title is transferred and payment is received).
For Existing Homeowners: Generally coverage is effective 30 days after receipt of funds. Check with the contract guidelines to confirm on the duration.
A standard service fee/deductible is a nominal fee charged each time you raise an issue. Some repairs may require more than one service partner or several unrelated visits to the house by the same service partner, and a service call fee is charged for each visit. If a contractor has to order parts and come back to your house at a later time to complete the repairs, this visit would not require an additional deductible. Fee varies from company to company, but it is generally between $40 to $100 per incident. Some companies have zero deductible home warranties
Denial of claims may be caused due to code violations, unusual wear and tear, improper installation, pre – existing conditions and in some cases issues due to improper maintenance. Some companies however, do cover damages resulting from lack of maintenance. For further details, refer to your warranty contract.
A home inspection is a procedure in which a home inspector investigates the comprehensive information about property conditions. He/she analyzes the description of problem in a written report and recommends further evaluation if required. Normally every Inspection report is guaranteed for 30 days.
You must have received your Home Protection Kit after having purchased warranty coverage within which you will be able to find all the information and materials you need on the service contract. You have several options, you can locate the toll free numbers of the service providers and place a call to them. Your call should be immediately answered by a customer service representative who will expedite your request. Most companies have a customer service wing that functions round the clock.
Most warranties come with an emergency repair service option. You may simply contact customer service toll free number and report the problem. Normally customer support works for 24 hours a day, 7 days a week and 365 days a year. They will schedule the dispatch of a qualified service technician as early as possible. Following which, the technician can rectify and sort the issue.
It usually takes 48 hours, following the acceptance of your claim, to provide you with a service call. In case of an emergency, the service time may be much quicker.
If the damaged item is covered under the policy, the technician will normally fix it on the spot. Warranty Company may provide the cash payment on repair or replacement. If it is diagnosed that the covered item is not repairable, or it is not cost effective to repair, the appliance may be replaced with a new product with the similar primary functionality and capacity. But the company may not be able to provide exact match in color, dye, material, type or brand.
Manufacturer’s Warranty is designed to cover factory defects of a new product. It is of limited duration, normally for a period of up to one year and covers only ONE appliance. But home warranty covers a whole range of appliances which are usually aged and stand higher chances of breakdowns.
A home buyer’s protection plan is a service contract that covers repairs and replacements of insured appliances and systems like electrical, plumbing and heating systems and built-in appliances that are not covered by regular homeowner’s insurance.
Home warranty coverage varies from company to company. It is very essential that you read the terms and conditions of the policy before choosing one that is suitable for your requirements. Most of the standard policies cover plumbing and heating appliances, but if the cooling units are not covered under the basic plan you can still include it by paying an additional fee, into your policy.
Though there are different plans available in the different warranty companies, most plans function in the same way.
Step 1- In case any of your systems/ appliances stop working, you need to call your home warranty company and inform them about the fault.
Step 2- Home Warranty company contacts a service provider with whom they have contracted.
Step 3- Now, the service provider calls you (home owner) to fix an appointment.
Step 4- Issue will be fixed by the technician who visits your house. In some rare cases if the appliance could not be repaired and needs to be replaced, based on the conditions mentioned in the contract, home warranty company will pay for the replacement of the appliance.
Step 5- As a small out pocket expense, you may need to pay for each service request. You may have to pay a Trade Service Call Fee of around $50 per visit. Some companies offer plans that do not charge any service call fee.
Usually the home warranty coverage plan begins 30 days after the payment receipt or on the day the sale closes. The coverage plan generally covers the appliances for 365 days from the date the policy is active.
When your original home warranty expires, you have the choice of renewing your existing warranty. Before deciding on extension of home warranty duration, it is essential to know whether the existing warranty is really beneficial or not.
Home Warranty Company will send the notification to the warranty holder regarding the renewal of coverage. The homeowners will be notified about the expiration date in advance and will be provided with a variety of convenient payment options.
If your home is newly constructed, then you may think that home warranty is not essential for first few years. But it is wise to have a warranty protection plan to protect you from costly repairs and replacements.
A standard policy usually costs around $200-$600 per year, which is reasonable and can certainly save you from spending money on repairs or replacements. However, remember that you cannot get extended warranties on plumbing, duct work, electrical or gas systems.
Homeowner’s insurance protects personal belongings and the entire house from damages due to burglary, crimes or natural disasters such as fire, lightning, tree fall and certain other explicitly mentioned perils, but it does not cover issues caused due to wear and tear or age. Hence homeowner’s insurance can never be used to replace a home warranty or vice versa.
Home warranty plans cover your household appliances and systems from breakdowns and puts less risk on your budget. When an insured device malfunctions, it is either repaired or replaced by the warranty company. Basic home warranty plan covers major appliances like heating, air conditioning, plumbing systems, electrical appliances, kitchen and laundry appliances or any other expensive units.
Your homeowner’s insurance is a hazard insurance, and only covers items damaged due to fire, flooding, wind, and other natural disasters and perils. A home warranty repairs household appliances and mechanical systems that break down due to normal wear and tear.