One of the best investments for your hard-earned money is buying your own home. However, there are several factors you must consider, like maintenance and renovation, especially if you are purchasing an old house.
Whether the home you chose is new or not, there will be a high possibility that it will come in a package with a home warranty. Home warranty sounds good, right? But do not take the word literally because a home warranty is not the same as a warranty for appliances or smartphones.
What Is A Home Warranty Plan?
When you hear the word “warranty,” the first thing that comes to your mind is the replacement of the same type of goods for being defective or below the standards. However, home warranty plans do not work in the same way.
Home warranty plans are usually service contracts that exist to provide repair and maintenance of your primary home systems like plumbing, electrical concerns, and other appliances like heater and refrigeration.
How Does A Home Warranty Plan Works?
Some people think a home warranty is a synonym for home insurance, but that is not the case. These two home plans are independent, and you cannot replace one with the other. However, you can have both plans at the same time.
The home warranty plan and home insurance differ in coverage. Home insurance usually covers damage done by natural disasters and fire. On the other hand, a home warranty covers the repair and maintenance of your home appliances, electrical system, piping or plumbing system, HVAC (Heating, Ventilation, and Air Condition), and your home. It covers these things to prolong the usage of the items.
Cost And Coverage
The mode of payment for home warranty plans is yearly, which ranges from 300 USD to 600 USD. It also offers several options where you can pay additional money (usually 100 USD to 400 USD) to add more items for the home warranty coverage.
The coverage of home warranty varies per company. The following are the usual items that are covered by home warranty plans:
- electrical and wiring systems
- air conditioning system
- plumbing or piping system
- refrigerator
- heater (water and air)
- ventilation
- electric fans (exhaust fans, ceiling fans)
- kitchen appliances like gas range and oven
- other utilities like doorbells and garbage disposals
- garage door systems
- Bathtub
- Dishwasher
Most home warranty plans have add-on options because they do not cover all home items. You can add several items to your plan in exchange for paying extra money. These items will be added to the general repair and maintenance plans by companies conveniently.
The selection of add-on items may vary per home warranty companies. Here are some of them:
- Electric fans (desk fans and stand fans)
- Washers and dryers
- Faucets
- Swimming pools
- Spa and other recreation
- Sprinklers
- Plumbing Stoppage
- Septic Tank Plumbing
- Roof Leaks (limited or per contract)
- Second refrigerator or freezer (standalone)
- Pumps (well and sump pumps)
Pros And Cons Of Having A Home Warranty Plan
Pros:
Having a home warranty can bring you peace of mind as you will not be worrying about going to one shop from another to buy things. Most primary systems that are essential for a home are included in a home warranty.
It also brings comfort and convenience, knowing that you and your home assets are working correctly and can be fixed when certain items break down. The most significant advantage of a home warranty plan is that you can max out the usage and life span of your home and appliances that you initially paid for.
Cons:
Despite having tons of advantages, the home warranty plan has a major drawback. It is the coverage of the plan. Most home warranty companies do not cover all appliances and systems. You will be paying for additional money. You must read the terms and conditions of the home warranty contract carefully.
Another disadvantage of a home warranty plan is that it will not cover appliances or home systems that are not properly maintained. Before a home warranty company gives you a contract, they will do check your possessions if they undergo proper maintenance. This factor is one the cause of misunderstanding between the home warranty company and the homeowner.
Especially if you buy an old property, if the previous owner did improper maintenance, it will not be considered by the warranty company.
Conclusion
A home warranty can provide an outstanding solution for your repair and maintenance issues. However, you must weigh the pros and cons before you get covered. Extensive research and assessment can be done to know what you really need considering your budget.
Knowing what items that need regular repairs and adding items that are essential to your daily life can bring you a relaxing and worry-free experience from availing a home warranty plan.
