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Home /  Home Warranty Guides / Top Tips for Buying the Right Home Warranty
last_updated_date Last updated: October 18th, 2021

How to choose a home warranty? Top Buying Tips

PUBLISHED: SEP 30, 2021 • 6 MINS READ

If you have owned a home for a while or plan to purchase a pre-owned one, you know there is always a risk that your systems and appliances will break down. The pricey repairs and replacements can blow your budget but a home warranty could be a moneysaver. It is a protection plan that covers the cost of servicing your home devices that break down due to normal wear and tear. Now, with the number of home warranty companies that are available already, it becomes confusing to choose the right one.

How-To-Choose-A-Home-Warranty-Top-Buying-Tips

So, to make your life easier, we have researched and curated a list of top factors key to your buying decision. Keep reading to find out some tips to get the best possible home warranty plan.

tips_blockTop Buying Tips

The home warranty you select must meet your home’s requirements. To start with, you can follow these quick steps to zero in on the best-suited plan for your home.

1.

Figure out your requirements

Make a list of items you want covered by the home warranty plan. To start with, check if your home has any older appliances that are likely to require repairs. You should also look at the condition of major systems like, air conditioner, water heater, and furnace.

2.

Do the research

Make a list of companies that match your requirements, and research their plans, pricing, and services. You can also read their reviews and ratings provided by Home Warranty Reviews.

3.

Ask your Friends, Family, and Neighbours

Talk to your near and dear ones, who have bought home warranties. Their experience may help you figure out your best fit. Find out details about companies that provide services in your area, their plans, pricing, and contractors.

4.

Get free quotes

Once you have shortlisted the companies, it’s time to ask for free quotes. With the help of these estimates, you can identify if the plan is within your budget. You can easily get free quotes from the companies that you are interested in by submitting your email address and zip code.

Factors That Are Key to Your Buying Decision

Now that you know how to research companies, let’s move on to the factors that you should consider before making a decision.

Service Area

It is necessary to find out if the company you have selected operates in your area. There are many companies such as IGS Home Warranty that only serve in a specific state – Ohio. You can easily check out the companies active in your state by going through this list.

Coverage

Home warranty coverage varies, as each company offers different plans to their customers. However, most companies offer standard coverage for the following major systems and appliances. For example:

refrigarator

Electrical system
refrigarator

Ductwork
heating_System_icon

Heating Systems
refrigarator

Plumbing system
refrigarator

HVAC system
refrigarator

Dishwasher
refrigarator

Microwave
refrigarator

Refrigerators

You can also get optional add-ons with your base plan at a few extra dollars

Spa

Spa
Swimming-Pools

Swimming Pools
Roof-Leaks

Roof Leaks
Stand-Alone-Freezer

Stand Alone Freezer
Second-Air-Conditioner

Second Air Conditioner

Cost

The overall cost of home warranty depends on the selected plan, optional add-ons, and the area of residence. The average cost of a one-year home warranty plan ranges between $300 to $500. If you opt for comprehensive coverage, you are expected to pay anywhere from $400 to $800. As for the service call fees, they can range from $60 to $125 per visit.

Repair Service Quality

Some home warranty companies offer labor guarantees for a specified period. Along with that, they may give 90 days repair guarantee or lifetime guarantee on parts. You can look at such aspects of companies while purchasing the home warranty.

Claim Fulfillment

Once you purchase a home warranty, companies impose a waiting period of 30 days, usually. You can start filing your claims or request service visits after it ends. Most companies assign qualified repair contractors to diagnose your issues within 2-5 business days of claim submission. However, if you have filed an emergency claim, a contractor may reach out in 24 hours. You can get more specific information regarding claims in your service contract.

Customer Support Quality

Most home warranty companies offer 24/7 customer support services, via online forms to fill out claims, and phone lines. So, make sure that the company you are interested in also offers such services. Check reviews to see how prompt they are.

Contractors and Technicians’ Network

Make sure that the company you are interested in has licensed contractors and professional technicians. Ask them whether they allow you to choose an independent contractor if they are unable to find one in your area.

Understanding the Fine Print

The biggest mistake customers make while purchasing a home warranty is that they overlook the terms and conditions. They assume that items are covered when they are not, leading to claim denials. So, take your time and carefully read the contract to understand what’s being offered.

What does a contract contain?

A home warranty contract usually contains details about covered items, optional coverage, plans, contract terms, fees, claims, limitations, and exclusions.

  • In the covered items section, you can find specific information about what’s covered in each system and appliance. For example: In water heaters, all components and parts may be covered except fuel storage tanks. Here, you will also find how much the company will pay for the repairs or replacements of these items.
  • In the plans section, you will find different types of plans offered by the company.
  • In the contract terms sections, you will get details for renewal, cancelation, or transfer of the warranty.
  • In the fees section, you will find the pricing details of warranty plans i.e. premiums and deductibles.
  • In the claims section, you will get to know about the process of filing claims and other information related to it.
  • Lastly, in the limitations section, you can read about what’s not included in your home warranty. For instance, it may say that the company will only cover mechanical failures. Or, the company is not responsible for damage caused due to fire, snow, or Acts of Gods.

Things You Should Know Before Buying a Home Warranty

These are a few things that you must know before buying a home warranty:

Understand your warranty contract

There may be some limitations to your home warranty as most companies do not cover pre-existing defects. Your systems and appliances must be in good working condition before the policy goes into effect. Also, your warranty will not cover everything. Let’s say, it will include electrical items, but it may not cover some parts such as intercom or lighting fixtures. So, read that fine print again.

Check out the offers and discounts

There are various ongoing discounts by some top-rated home warranty companies. So, always keep your eyes on them and stay updated.

Don’t trust blindly what Sales Executives say

Many times they can make you rush through the purchase process. If you don’t familiarize yourself with everything beforehand you will be in trouble later. So, make sure you check out important things like premiums, deductibles, minimum contract length, estimated system and appliance coverage.

Don’t confuse it with Homeowners Insurance

It should be noted that a home warranty is not the same as a homeowners insurance. A home warranty covers repairs and replacements costs of home systems and appliances that break down due to usual wear and tear. On the contrary, homeowners insurance covers damages caused by fire, winds, thefts, etc. A homeowners insurance is usually mandatory, as banks generally do not issue mortgages on a home without it. A home warranty plan is generally a 12-month contract, and not required to obtain a mortgage.

Choosing a home warranty as a seller

If you are a seller, getting your home market-ready must have been a stressful task. Consider purchasing a seller’s home warranty to cover major home appliances like water heaters or air conditioners, from the cost of unexpected breakdowns. If any of the covered items break down during listing, you would not need to pay extra for it. The company will send professionals to fix it. An added benefit is that sometimes home warranty companies will offer a free seller’s warranty to you if you agree to purchase a home warranty for the buyer.

tips_blockTips for Realtors and Buyers

  • If you are a home buyer, you may get a home warranty from your seller. You can even ask them to pay for the same. Most buyers tend to continue with the warranty purchased by the previous owner. However, there are many buyer-specific warranties available that can also be considered.
  • If you are a real estate agent, you can get a home warranty to promote your properties in competitive markets. While offering a home warranty to a buyer or a seller, make sure you fully disclose the terms and conditions to them. You should give them the option to choose other home warranty providers, if they don’t like the companies on your roster.

Top Home Warranties of 2021

A good home warranty company understands their customer’s needs. Here is a list of the best-rated home warranty companies and their offerings. You can choose a plan that suits your requirements and submit a free quote to get details about pricing.

AHS is one of the oldest and most trusted companies in the market.
They offer three different plans with some of the highest coverage caps in the industry named ShieldSilver, ShieldGold, and ShieldPlatinum.
They provide services in 49 states.
American Home Shield (AHS)

Rating star Rating star Rating star Rating star Rating star
CHW is well known for their wide network of contractors.
They offer two plans to their customers – the Basic and Total plans.
They are one of the few companies to offer roof coverage.
Choice Home Warranty

Rating star Rating star Rating star Rating star Rating star
They are famous for their low service call fees.
SHW offers three plans – the BronzeCare, GoldCare, and PlatinumCare plans.
They provide system coverage upto $2000.
Select Home Warranty

Rating star Rating star Rating star Rating star Rating star

Making the Final Call

A home warranty can be a wise investment when you have chosen the right one. An ideal home warranty should offer various benefits, such as flexible pricing and payment options, great discounts deals, and attentive customer service. So, consider the above tips, factors, and recommendations while buying a home warranty. Lastly, to make sure that you are using your money wisely, always read the fine print of your service contract before signing up.

FREQUENTLY ASKED QUESTIONS (FAQs)

Q.

What is the duration of a home warranty?

A.

The duration of the home warranty plan depends on the plan you’ve selected. However, most plans usually last for a year. You have the option to renew it at the end of the contract term. Some home warranty companies also offer multi-year coverage.

Q.

How to choose a trustworthy home warranty company?

A.

You can look out for the following things while selecting a home warranty company:

  • Coverage offered by the company
  • Company’s inclusion and exclusions for each item
  • Cost of the plan you like
  • Technicians used by the company
  • Reviews of that company’s services
Q.

Should I choose a regional home warranty company?

A.

You can choose a regional home warranty company. There are plenty of companies whose services are limited to a particular region. Sometimes it’s better to choose a local company, as most of your friends and neighbors might have used their services. Their experiences may help you find a company with better service quality.

Q.

Do I need a builder’s warranty?

A.

If you are purchasing a newly constructed home, you may get a builder’s warranty along with it. You may need it to cover the major structural components of your home against any physical damage. If you want to protect your home systems and appliances, you can purchase a home warranty along with it.

Q.

How to purchase a home warranty?

A.

To purchase a home warranty, determine your coverage requirements, then get free estimates from Home Warranty Reviews for the companies you’re interested in. Lastly, read the contract to know what’s being offered.

Q.

How long does it take to get a home warranty?

A.

You can take as long as you like to completely research a home warranty company and choose a plan. To speed up the purchase process, you can refer to our research and get free quotes. Once you purchase that plan, there is a waiting period after which you can start using it. If any of your covered systems or appliances break down, you can start filing claims after the waiting period.

Q.

How soon can you use a home warranty after purchase?

A.

After purchasing the home warranty, there is a waiting period of 10-30 days. Once it ends, you can start using your home warranty plan.

Q.

Can you buy a home warranty after something breaks?

A.

You can buy a home warranty plan at any time, but read the contract thoroughly to know if pre-existing conditions are covered. A broken appliance would count as a detectable pre-existing condition, and companies don’t generally cover that.

Q.

Can You Get A Home Warranty On An Older Home?

A.

Yes, you can get a home warranty for older homes or pre-owned homes. It can be worth investing your money in a home warranty for such homes since they come with a lot of unknowns. So, a home warranty can help you save on maintenance costs.

Q.

Can you buy a home warranty at any time?

A.

Homeowners can purchase a home warranty at any time. Most people protect their investment by purchasing a home warranty when their appliance warranty expires or major home systems begin to wear and tear.

Q.

Who should pay for a home warranty?

A.

A buyer or a seller can pay for the home warranty. However, most buyers ask sellers to pay for the first year of the warranty.

Q.

Do home warranties cover roofs?

A.

Home warranties generally do not cover roofs. However, there are a few companies that offer roof coverage as an optional add-on. You can select that with your base plan at some extra cost.

Q.

What is a loophole I should avoid when buying a home warranty?

A.

One of the common loopholes are coverage caps and exclusions. If you do not know the exclusions, you may be caught by surprise if the company does not honor your claim. There might be some clauses in your contract that you can’t hold against them later. For instance, once you hit the upper limit of the coverage cap of any covered item, the company will not be responsible for repairs after that. To avoid such situations, you must thoroughly understand the terms and conditions of your contract.

Q.

Are home warranties worth the money?

A.

A home warranty may be worth the money, if things like HVAC, plumbing systems, electrical systems, pools, or appliances, such as dryers, dishwashers, and ovens in your home are prone to breaking down. It could help save lots of money on repairs and replacements. It is relatively inexpensive, as plans generally cost less than $60 a month, excluding add-on items you may choose.

Top home warranty Companies

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