How irritating is it that every time you make a technology purchase at the store they ask you if you want a warranty? Usually, when you do buy the extended warranty, it guarantees nothing. After the device breaks and you actually look into the inclusions and exclusions, you find that everything that could possibly go wrong isn’t covered anyway. Most of the reasons things break for have anything to do with accidents or negligence on your part, which are rarely covered under any sort of warranties that you can buy.
The newest thing in homeownership is home warranties. Being touted as the best way to ensure that everything under the roof, sometimes even the roof can be repaired without cost, home warranties are being pedaled by mortgage companies and insurance companies across the nation. But, before you decide to invest in them, it is a good idea to understand if they are really covering your individual needs.
If you have a mortgage, then you have to have insurance on your house, but much like a liability rider on your car, it does very little to help you unless your house is demolished. If things break, your brand new refrigerator goes kaput the day after its warranty is up, or your air conditioner blows just five years after your investment, not many home insurance policies do much but say “that is too bad”.
A home warranty policy is supposed to be the answer to your home worries. Covering you for all the inconsequential things in your home that can still add up to big time cost, they were designed to help the homeowner afford those little maintenance or appliance mishaps.
There is some merit to a home warranty and hiring a long distance moving company. Many companies are well worth the cost of insuring your home, especially if you have high-end appliances or many of them, but the problem is that many consumers make the mistake of just assuming that they understand what they are getting for their premiums. Like any contract you sign, or agreement that you enter into, you really have to make sure that you know what the warranty will or will not cover.
When you consider that having a repair technician come to look at an appliance that breaks down is $60 alone, then some home warranties not only make sense, they are a good way to ensure your expensive repairs or replacement costs are covered.
Not all policies are the same, nor are all companies. Just like any other type of insurance, they calculate the cost of your warranty premium by state, locale, the size of your home, the cost of your appliances and the amount that maintenance or worst case scenario replacement, would cost. Before you take out any policy, it is important to understand how a home warranty works.
What is a home warranty?
Essentially, it is a policy that covers those things inside your home like plumbing, electrical work, heating and cooling and the appliances that you have. If you have a breakdown, they help to pay the cost for repairs, or if it is more affordable to replace an item, they usually will cover the cost of replacement. The type of policy that you take out will determine the extent to which the policy covers things. From water heaters to garbage disposals, some policies will cover everything from A to Z, but they do come at a cost.
Many companies will not include high-risk things such as refrigerators, spas, pools or outdoor items, which is important to know before you take out any policy. Those exclusions will be stated clearly in the policy itself.
Once you have taken out a warranty, if something should happen, each company will have a procedure that you must follow to get your appliance fixed. That is why using a more reputable insurance company that costs a little extra may behoove you. If a company can’t get someone out to fix your air conditioning for six weeks in the heat of the summer that isn’t going to help you at all.
Like any other contract that you enter into, a home warranty is like an additional rider on your home insurance policy, and should be read with a fine-toothed comb. It helps you to fix those things under your roof that break and need repair. Any insurance policy is going to be like gambling. You are betting whether something will happen or not, but the likelihood that something will go wrong is high. Weighing your cost of repair to the benefit of the policy is the most important way to choose the right company and the right warranty for your individual needs.