Things Covered and Not Covered in a Home Warranty

A home warranty sounds like it is a great form of monetary security against unexpected, expensive home repairs. But you should understand what is covered in a “standard” home service contract. When you are buying a home, there is possibility that you were provided with a home warranty by the seller and you assumed that it will take care of all repairs inside your home. But there are some items NOT covered in a home warranty.

Basics of home warranty –

What Does Home Warranty Cover?

The best answer to this can be found by evaluating your specific contract or by reviewing an on-line contract sample.

Basic coverage includes:

  1. Plumbing stoppages
  2. Plumbing System
  3. Sump pump (permanently installed)
  4. Toilets
  5. Hot water pump
  6. Bathroom whirlpool motor pump
  7. Water heater
  8. Ceiling fans
  9. Smoke detectors
  10. Built-in dishwasher
  11. Built-in microwave
  12. Attic and exhaust fans
  13. Heating and duct-work
  14. Telephone system
  15. Electrical system (interior)
  16. Instant hot water dispenser
  17. Built in trash compactor
  18. Oven
  19. Cook tops
  20. Doorbells
  21. Air conditioning
  22. Garbage disposal
  23. Range and oven
  24. Telephone wiring
  25. Central heating system
  26. Range Hood
  27. Humidifier
  28. Refrigerator and ice maker
  29. Washer and dryer
  30. Trash compactor
  31. Duct work
  32. AC refrigerants and coils
  33. Plumbing faucets and fixtures
  34. Freestanding ice makers
  35. Improper appliance installation
  36. Mismatched systems

Because coverage differs from policy to policy and from state to state, request to see a sample copy of a policy before you commit. The sample copy clearly states what items would be covered under your home warranty policy and also the extent to which the items are covered.

What is Not Covered in a Standard Plan?

As discussed above, the contract covers only those parts, systems and appliances that are mentioned as covered and excludes all others. Remember you can always pay an extra premium to cover these items before you sign the contract. You can read more about including these items under “Types of Coverage” further down in this article.

  1. Faucet repairs (unless otherwise stated in the policy)
  2. Spa or pools (you can request/add this coverage in some cases)
  3. Hot tubs (you can request/add this coverage in some cases)
  4. Sump pump (you can request to add this in some cases or unless it’s stated otherwise)
  5. Washers and dryers or garage door openers are not included in all plans. These come under “Enhanced Coverage”
  6. Outdoor items such as sprinklers
  7. Whirlpool bathtub (you can request/add this coverage in some cases)
  8. Haul away debris
  9. Hauling away old appliances
  10. Outdoor water systems
  11. Combo ceiling fans
  12. Second air conditioner
  13. Second fridge/freezer
  14. Food spoilage
  15. Wet bar refrigerator
  16. Well Pump
  17. Booster pump
  18. Central Vacuum
  19. Limited Roof Leak
  20. Septic system
  21. Septic Tank Pumping
  22. Stand Alone Freezer
  23. Home entertainment
  24. Office package
  25. Central AC unit
  26. Wine cooler
  27. Additional spa
  28. Washing machine
  29. Extended pipe leak coverage

However, for items such as washer/dryer, kitchen refrigerator, air conditioning, spa equipment, pool, roof leak repair, etc, additional or optional coverage are available for an extra fee at the time of contract. Verify your contract to check which items are listed under optional coverage, if any, were paid for.

Basics of Home Warranty

A home warranty is neither similar nor it is a replacement for homeowners insurance. Homeowners insurance policy covers major unforeseeable events such as fires, theft, property crimes, hail and certain types of water damage that could have an effect on the homeowner’s personal possessions and the entire structure. A home warranty does not cover these hazards but it covers particular components of the home. It covers regular wear and tear defects which may include an older air conditioner break down or requiring certain parts changed if you have kept up with the needed maintenance. In simplest terms, a home warranty is an additional coverage for the items in your home which might initially have been covered by a manufacturer’s or builder’s warranty.

When you purchase a home warranty, you are principally signing a service contract. The contract provides for low-priced repair and replacement service on a number of major home appliances. Most plans have a basic component that offers all the homeowners who pay for a policy with certain coverages. The contract will spell out which appliances it’ll cover, how much is required to be paid per occurrence and what is not covered. For instance, structural aspects of your home are not covered. So if your roof falls down, that would be covered by homeowner’s insurance. In case your water heater leaks, the water heater would be covered by a home warranty but the consequent water damage would be homeowner’s insurance issue. Homeowners are also allowed to procure one or more optional components that give additional coverage at additional cost.

How much does a Home Warranty Cost?

They are quite inexpensive, usually ranging from $239 to $619, based on the coverage. Home warranty companies every now and then run special discount policy prices or special sales or provide additional coverage for the same price. The policies are prepaid for a year in advance, after which they run out or can be renewed. Some companies provide you with the option of breaking up the premium into monthly payments so as to reduce the burden of making one upfront payment.

How Do They Work?

Though specific plans offer definite types of coverage, most operate in the same way.

  • If a home appliance or a system breaks down, the home owner calls the home warranty firm
  • The home warranty company calls a service provider with whom it has a business arrangement in order to examine the problem
  • The provider then calls the home owner to make an appointment
  • If the provider settles on that the required replacement or repair is covered by the warranty, he accomplishes the work. In case an appliance cannot be repaired and is malfunctioned, based on the contract coverage, the home warranty firm will pay to put back and set up the appliance
  • The homeowner only pays a small trade service fee or a deductible ($50 to $100) plus the money he/she has spent by now to buy the warranty

Watch this video to know how home warranty works –

Types of Coverage

As all home warranty plans differ, you are required to ask specifically what is covered under your plan. Inquire with your real estate agent if upgrades are available. Make sure to know whether the home warranty company will pay for your repairs to make certain types of appliances or systems compliant with new regulations. Pay close attention and read the home warranty contract cautiously to know the coverage, limitations and exclusions.

Home warranty companies have three types of coverage – basic coverage, enhanced coverage and an optional coverage. Some companies may not have a basic coverage but have a standard policy instead. Don’t get confused, they are the same. It’s just that different companies have different names.

Basic Coverage

A basic home warranty coverage includes major systems and everyday use appliances. The items covered in a basic coverage sometimes differ from state to state. The list of everyday use appliances varies depending on the climate conditions and other factors. For example, plumbing system, built-in microwave, ceiling fans, etc

Not all companies include the same list of items in their standard policy. What one home warranty company may include in its basic coverage, another company may list under an enhanced coverage.

Enhanced Coverage

The enhanced coverage includes certain systems and appliances that are not included in a basic plan but are commonly used. An enhanced coverage costs slightly higher than a basic coverage. In certain home warranty policies, your HVAC, refrigerator, washer/dryer, etc, are not included in the basic coverage but are a part of the enhanced coverage.

Optional Coverage

Optional coverages include those items that are not covered under a basic or enhanced coverage. This coverage gives you the option of adding your pool, spa, wine cooler, well pump, etc, to your home warranty policy. You need to pay a fixed extra premium to add an optional item to your home warranty policy.

Most home warranty company websites have a sample policy that states what items are included in a basic, enhanced and an optional coverage. Make sure to read through the document to gain a clear understanding on the items included under each policy.

What to Expect in a New Home Warranty?

Home warranties may be procured by individuals buying a new or used home, landowner, and persons selling their homes or investors. Each company’s coverage is decided by the terms of its contract, but basic home warranties usually cover the parts and labor on or replacement of chief home systems and equipment.

What’s covered? Most home warranty firms provide a variety of plans, all offering different levels of coverage, so be sure to study the details of any contract before procuring. Even if you decide to renew the contract from year-to-year, double check the details of your plan as the coverage can change every year. If the policy does not cover some of your appliances, you can check with the company’s representative whether you can opt to include additional appliances in your plan by paying a slightly higher premium.

Here is a common idea of what a homeowner can wait for to find in each tier of service.

The Bottom Line

A home warranty is not an ideal solution to the risks homeowners face. Before buying one, it’s important that the homeowners read the home warranty contract and consider whether the warranty is likely to pay off. Home sellers who want to provide a warranty to buyers, and homeowners or buyers who feel more relaxed having a home warranty should also do extensive research to get a reputable home warranty company that will, in fact pay for legal genuine repairs when they are required.

Other home warranty tips –



Recent Comments
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Phil Ackerman
02-08-2016
If there are any structural issues with your home for example basement, are they covered under the homeowners warranty and if not is there coverage that the seller can buy for the new buyer to cover any structural issues with their house? Thank you
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Brandi Klein
09-06-2016
Lightning struck on or very near our house and now our digital oven and treadmill dont work. Wouldn't homeowners insurance cover repair of those after deductible? Also, what if we purchased a service contract for oven repair and dont have out of pocket expense at time of service since covered by the service contract? Can the amount the repair would have cost be applied to homeowners ins deductible since paid extra at time oven was purchased to have covered?
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Dave Mckee
25-04-2016
I filed a claim on March 1, 2016 for a refrigerator problem. A repairman checked it out b, but would not proceed until I checked on any factory warrantee. It was expired. I informed them. About April ist I called them. They said they were waiting for the tenant to make an appointment. Then they returned and had to order parts. They missed the next appointment. The repair was finally done April 22. There is no way to talk to the complaint dept. Or to email them direct. Snail mail is available if you dig hard enough. Terrible service! No appologies.
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Monique
15-04-2016
Last week our AC went out home shield sent out the first man from Climate solutions he said the condenser was bad , then another guy came out and said nothing was wrong with the AC. Then another man came out and said the AC was shot and mild was growing out of the Unit and that HomeShield would not replace it we have had HomeShield for over three years and dam if it's just the run around for this warranty . This is for anyone who thinks they want HomeShield watch out look at exactly what your warranty has on it ask many questions I mean many questions before you sign up with them. I am not a happy customer with HomeShield I think they are out for money.
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norma
14-04-2016
I've been screwed by both AHS and CHW...stick a fork in me, I'm done. I will save up my $400 a year and use that toward repair/replacement and can call any reputable company I desire to use.
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07-03-2016
[…] your homeowner’s insurance mostly covers the unforeseeable things that happen TO your house.  Home warranty covers the things that happen in your house that are expected, even guaranteed to eventually occur.  Your insurance is a wager of sorts […]
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Louise Brockmeier
29-02-2016
I have several cracks in my bathtub that leaks and has caused water damage and mold to my walls..is my home owners insurance covered by this? Thx
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Which Appliances Should Be Included Under Home Warranty?
17-02-2016
[…] with discounted repair and replacement services. When you purchase a home warranty plan, it will cover certain fixed appliances in your home which would be clearly mentioned in the contract. As and when any such appliance breaks, you can […]
E
Easy And Quick Swimming Pool Maintenance Tips
12-12-2015
[…] save a load of cash if you have an active warranty on your pool. For more information, do look into the coverage of a home warranty plan. Next, we’re going to give you a step-by-step guide on what must be done to keep your pool clean. […]
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kimm
08-12-2015
BEWARE CHW they take DAYS to find a contractor to service your needs then the deney the claim and you end up paying out of pocket this is the 3rd and last time in the 8 yrs I paid for services not provided by them.
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