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Your home is possibly your biggest financial investment and the breakdown of major appliances can result in extravagant costs that disrupt your budget. You need to understand that a home warranty is a valuable asset that provides financial protection, and convenience in numerous ways. By having a home warranty, homeowners can rest assured knowing that their major household systems and appliances are covered, and they will not face financial burdens in case of unexpected repairs or replacements. Unexpected repairs can be expensive and hard to budget for, and they can strike at any time. From leaks that cause electrical issues to pests, like an opossum in attic, that chew through wires, there are plenty of things that need protecting against. To do this, you need to understand why home warranties are important.
Understand What a Home Warranty Is
A home warranty refers to a service agreement that covers the repair or replacement costs for the crucial systems and appliances in your home due to normal wear and tear. It bridges the gap between homeowner insurance and manufacturers’ warranties, providing a layer of protection that these do not. Unlike homeowner insurance, which protects against natural disasters, theft, and certain types of damage, a home warranty focuses on the functionality of major appliances and home systems. Finding quality home warranty plans should be a priority for any homeowner.
Contrary to what many believe, the manufacturer’s warranties on appliances often expire long before the appliance stops functioning. This leaves homeowners at risk of cost burdens whenever a breakdown occurs. With a home warranty, expenses resulting from mechanical failures in covered systems and appliances are catered for, helping to alleviate these unanticipated costs. When selecting a home warranty, one should be careful to choose a reputable company with a history of good customer service and comprehensive warranty offerings.
The Benefits of Home Warranties
Home warranties offer numerous benefits to homeowners. They provide financial protection from unexpected repair or replacement costs. If your furnace or central air conditioner breaks down, for example, the cost of repairing or replacing it can skyrocket, especially when you least expect it. A home warranty covers such costs, protecting you against such financial shocks. These warranties also save homeowners the trouble of finding a qualified professional for repairs.
Warranty companies usually have a list of licensed and insured contractors in different fields, which saves you the time and effort needed to find one whenever a breakdown occurs. Furthermore, such professionals perform their work under careful supervision, assuring high-quality service. Additionally, home warranties come with a guarantee for the work done. This means if a repair doesn’t work or a replaced appliance fails, you won’t be required to pay for the same service again. This adds an extra layer of financial protection and mental peace for the homeowner.
Knowing the Coverage Extent
Home warranties cover different systems and appliances in your home. Some of the commonly covered items include plumbing systems, including water heaters, electrical systems, kitchen appliances like refrigerators, ovens, and dishwashers, and heating and air conditioning systems. Some warranties also provide coverage for items like septic systems and pools, though these aren’t as common. While home warranties cover a wide range of appliances and systems, note that they may not cover everything. For example, expenses related to roofing repairs or replacements are typically not covered. Thus, in such cases, it’s crucial to search for roofing companies near me to come out and perform regular inspections to avoid any costly surprises in the future.
Coverage often depends on the specific plan you choose and the company offering the warranty. Some policies may not cover items that haven’t been properly maintained or that were poorly installed. Understanding the specifics of what your plan covers is therefore essential. Most warranties involve paying a service fee, or deductible, for each claim made. Once you’ve paid the fee, the warranty company will send a contractor to analyze the problem and determine whether it’s covered by the plan. If it is, the repair or replacement costs will be taken care of by the warranty company.
Choosing the Right Home Warranty
The key to benefiting from a home warranty begins with choosing the right one. When selecting a home warranty, ensure you review multiple plans and companies. Consider the specific coverage offered by each plan, as well as the cost. While cheaper plans may seem appealing, they may not offer the comprehensive coverage you need. Conversely, a more expensive plan may cover more items, but it may not be worth the cost if you don’t need all the additional coverage.
The reliability of the warranty company is equally important. Check the company’s reviews and ratings to get an idea of their service quality. Consider how long they’ve been in business – companies with a track record of success are often more reliable. Also, check whether the company is licensed in your state, as this provides additional assurance of its legitimacy and reliability.
Another consideration when choosing a home warranty is its renewal process. Many warranties are annual, meaning you’ll need to renew them every year. See whether the renewal process is straightforward and if the company consistently honors its warranties. If customers have complained about warranties not being renewed or claims not being accepted, it might be best to look for a different provider.
Updating Your Home Warranty
Over time, your needs may change and the home warranty you initially bought may no longer suit your needs. If that happens, it’s good to know that most home warranty companies allow you to upgrade or adjust your coverage. Just like how you would update your homeowners’ insurance when making significant changes to your property, the same rationale applies to home warranties. Upgrading your plan is typically as easy as contacting your warranty provider and explaining your needs.
Your warranty company will be able to guide you through the process and recommend a more suitable plan if one is available. Remember to consider the cost implications of an upgrade, particularly if your budget is tight. Similarly, if you sell your home, you can transfer your home warranty to the new owners. This transfer can serve as a selling point, offered as part of the sale to incentivize potential buyers. A home warranty can give new homeowners more confidence in their purchase, knowing that they are covered against potential appliance or system breakdowns.
The Difference Between Home Warranties and Home Insurances
While home warranties and home insurance might sound similar, they are different forms of protection for homeowners. Home insurance is a contract that covers the damage and loss of your home and possessions due to theft, windstorm, fire, or other covered perils. It also offers liability coverage in case you’re legally responsible for someone else’s injury or property damage. On the other hand, a home warranty is a service contract that protects you from the financial burden that comes with replacing or repairing appliances and systems in your home.
Your warranty will cover things like your HVAC, electrical, and plumbing systems, as well as your appliances such as the dishwasher, refrigerator, and oven. It’s all about protection from wear and tear — things a homeowner’s insurance policy does not cover. Both home insurance and a home warranty should be considered necessities for homeowners. These policies also free up some money to make it easier to budget for home maintenance and home improvement.
As this blog illustrates, a home warranty is an indispensable tool for protecting your biggest asset: your home. It provides financial stability when unexpected breakages occur and ensures that you have access to qualified professionals to rectify any problems. When chosen carefully and used effectively, a home warranty can help you maintain your home with ease and peace of mind. Follow our advice and you can trust that you’re taking the best possible care of your home.
