Every homeowner or renter will find something in their residence that needs repair at some point. At times, this repair is minor. However, major breakdowns can quickly eliminate a person’s savings while inconveniencing them in the process. For this reason, many people choose to invest in a home warranty.
Before doing so, a person should know what a home warranty is and what it covers. In addition, they need to understand when to buy this coverage and the price of a home warranty. With this information, they can determine whether to make the investment.
What is a Home Warranty?
Home warranties, often referred to as home protection plans, are similar to service contracts a person may purchase when they buy a new household appliance. This plan covers the major appliances and systems in the home if they fail due to normal wear and tear. The owner pays a deductible for the cost of the repairs and the warranty company pays the rest.
Is a Home Warranty Necessary?
Many homeowners purchase a warranty to get peace of mind. They know they won’t face an expensive repair bill if something goes wrong in the home. However, before making this purchase, the homeowner needs to learn whether they already have protection in place.
For example, a builder or manufacturer might already cover the major appliances and systems in the home. Certain credit card companies extend the manufacturer’s warranty on products purchased using the cards. A homeowner might find they are already covered and a warranty is unnecessary.
What is Covered?
If a homeowner doesn’t have protection in place for most systems and major appliances in the household, a home warranty may be a good investment. However, the homeowner must carefully read the contract to learn what is covered and what the policy excludes. Certain plans cover specific appliances in the home, while other plans cover major household systems as well. Providers often offer a combination of the two.
What many homeowners fail to realize is that certain items will remain excluded under the warranty. For example, a warranty might cover repairs to a refrigerator. However, if the ice maker is defective, the owner must pay for the repair in full. It is not covered under most home warranties.
Is a Home Warranty Worth the Investment?
Homeowners must consider several factors when determining if they should purchase a home warranty. Many household systems in a newly constructed home, for example, will be covered under the manufacturers’ warranties, so separate coverage is not needed. For those who own an older home, a home warranty, when combined with a solid homeowner’s insurance policy, can be a smart buy.
Homeowners find they can limit out-of-pocket expenses when it comes to household repairs with the help of this warranty. Many people choose to invest in a warranty of this type when they plan to sell their home. The warranty gives potential buyers confidence that the major household systems and appliances are protected. When a person moves to a new area, they may also wish to invest in a home warranty. They aren’t familiar with local technicians and want a trusted company to handle the household repairs for them.
Choose a reputable provider and know what is covered under the policy. Homeowners who do so find they are more satisfied with the plan they purchase. However, there may come a time when the warranty doesn’t cover a repair. Learn why this is the case so similar issues won’t arise in the future. People who take this step find the warranty is a good buy because it provides them with peace of mind.