Whether you’re about to buy a home or you’ve owned your home for some time, a home warranty can provide the peace of mind you need in the face of looming repair costs. There’s no way you can predict when your furnace will stop working, but Murphy’s Law states that it will happen in the middle of the year’s biggest blizzard. When it does, you want to be ready. A home warranty can help defray the cost of repairing or replacing major home systems and appliances.
But, before you buy a home warranty, you need to know what these service contractors cover and how to customize a plan to cover sprinkler systems, hot tubs, pools and other systems and appliances not included in standard policies. That way, you won’t be in store for any unpleasant surprises when you call your warranty provider for service. Here’s how to make sure you know what you’re getting and how to get the coverage your home needs.
Do You Need a Home Warranty?
Before you start shopping around for home warranty plans and asking questions about coverage and addendums, you should decide whether you even need a home warranty. Most homeowners will benefit from a warranty, but if you’re purchasing a newly built home with new appliances, you may not need one.
That’s because most states require builders to guarantee a home’s structural elements and systems for at least the first 10 years of a home’s life. New appliances will still be covered by the manufacturer’s one-year warranty. If you purchased them with a credit card, your card issuer may provide an extended warranty on the items.
That said, a home warranty is often included as a seller’s benefit when you purchase a home, even one that’s not brand new. Sellers throw in home warranties because they keep buyers from calling them up after closing to complain about problems with the home. They can also cover repairs or maintenance that might be needed while the house is on the market. Some realtors may also offer warranties to new homeowners as a gift. If you’re offered a free home warranty, take it — you might as well.
Vet the Company
If you’re thinking of buying a home warranty, vet the provider to make sure you’re getting your money’s worth. Check online reviews at sites like the Better Business Bureau for customer complaints about any warranty company you’re planning on using. Contact your state attorney general’s office, office of consumer protection or insurance commissioner to ensure that complaints or lawsuits haven’t been filed against the company.
Ask the Right Questions
Once you’ve narrowed down your search to a reputable home warranty company, you need to know what they do and don’t cover and how to customize your plan to your needs. Prepare a list of questions to ask the representative when you call. You’ll need to know the cost of a home warranty policy, how much the service fee is (usually $60 to $75 per visit) and what home systems and appliances are covered. Some questions to ask include:
- How much of the cost of a repair or replacement will the home warranty cover?
- What systems and appliances are covered?
- Under what circumstances might a claim be denied?
- What are your responsibilities under the plan?
- What are the exclusions and limitations?
- What service providers does the company use?
For example, your home warranty provider may not cover repairs to burst pipes, but your home insurance provider probably will. Nevertheless, it’s a good idea to know what you can expect from your service contract before things go wrong.
Customize Your Policy
Most basic home warranty plans cover HVAC, electrical and large appliances. However, you might need additional coverage for a pool, hot tub, sauna or sprinkler system, for example. Ask your provider if your policy can be customized to include these home systems. Most providers offer more extensive policies for homeowners with pools, hot tubs and other such home features.
You never know when something important will break down in your home. A home warranty can help offset the high costs of maintaining and repairing a home and remove the stress of finding a contractor, besides. Make sure you’re getting a policy that will meet your needs, so you can become one of the many homeowners who swear by their home warranty service contracts.