Individuals understand homeownership isn’t cheap. Men and women can expect to pay a median price of $374,900 this year for a home in America, up $50,000 in the past year. To save on home maintenance and repair costs, many homeowners opt to purchase a warranty. Doing so helps to protect the value of their home while saving them time as well as money. 

The warranty serves as a service contract. The provider agrees to pay the cost of repair or replacement of covered items when they stop working. Before purchasing this coverage, people need to ask questions about your warranty to ensure it meets their needs. What do homeowners need to know before making this purchase?

What Should You Know When Looking for a Homeowner Warranty? - owner, home warranty, home


A homeowner must know any limitations of their home warranty. These companies function to generate a profit and deny payouts whenever possible to save money. In fact, consumers often contact the Better Business Bureau to complain because the repair or replacement of an item isn’t covered under the warranty they purchased.

Before purchasing a warranty, learn what it covers and what is excluded. This varies by company and policy, so never assume an item will be included in the plan until you have reviewed the policy documents. Choose a policy that covers the items you are most concerned about in your residence. 

Existing Coverage

Homeowners need to know whether they have protection for devices in their homes currently before purchasing a warranty. For example, appliances in the home may be covered by the manufacturer or a credit card provider if you purchased the appliance using the card. These providers often extend the length of the manufacturer’s warranty. American Express is an example of a provider that offers this extended coverage. 


Warranty costs vary by provider and plan. Home warranties typically come in three forms. The warranty will cover a specific appliance, all appliances in the home, or the appliances and plumbing and electrical systems. Furthermore, the location of the home plays a role in the cost. A person living in Ohio, for example, will often pay less for a policy that covers the appliances in the home than someone with the same appliances who lives in New York. 

Furthermore, most homeowners must pay a deductible for each covered repair. The fee varies by policy, provider, and work to be done. Keep this in mind when comparing plans and learn when a deductible must be paid and how much it will be. 

Terms and Conditions

The terms and conditions outline what is covered by the warranty and what is excluded. For instance, while a refrigerator may be covered under the plan, warranty providers often exclude the icemaker. A water heater is often a covered appliance, but the tank itself remains the responsibility of the homeowner. Finally, a failure to properly maintain the covered devices could lead to a claim being denied. 

Replacement Learn whether the plan will replace an item that cannot be repaired. A homeowner might find that they only receive the depreciated value of the appliance rather than the full replacement cost. The homeowner must cover any difference when purchasing the replacement item. 

Compare home warranties before making a purchase. Read all policy documents carefully to ensure you understand the coverage you will receive and what is excluded. Men and women who do so find they have fewer surprises when they need to file a claim with the provider. As a result, they are more satisfied with the coverage.