Editorial note: Homefront (defined in the Disclosure below) may earn a commission from affiliate partner links featured on our site. This commission does not influence our editors’ opinions or evaluations.
Carter Gaddis is a senior writer at USA TODAY Homefront. He is an experienced journalist who has written about roofing, sunrooms, title insurance and other home service topics. Carter has contributed to the TODAY SHOW parenting section, CBS SPORTS and ESPN, among other publications. He lives with his family in Central Florida, where he spends most weekends at theme parks or watching English soccer on TV.
A home warranty covers some or all of the cost to repair or replace home appliances and systems.
Homeowners insurance only covers damage related to events such as a storm or burglary, whereas home warranties cover malfunctions and breakdowns.
When researching home warranties, consider your coverage needs, your budget and home warranty providers’ reputations.
A home warranty, also known as a home service contract, covers the repair or replacement of your home’s major systems, appliances or both. A home warranty plan provides financial predictability if and when a household system fails or an appliance breaks down.
A home service contract supplements or replaces an expired manufacturer’s warranty. You pay monthly or annual premiums to a home warranty provider, which then pays some or all of the cost to repair or replace a failed system or appliance.
Before purchasing a home warranty, learn what it covers, how much it costs, how to use it and which top home warranty companies best suit your needs.
In the know
Over 150 homeowners have bought a home warranty plan from one of the above companies in the last 30 days.
The items or systems a home warranty covers depend on your chosen provider and plan. Covered items will be listed in your contract. If you aren’t sure whether your plan covers a specific item or system, ask a customer service representative before you sign the contract.
Most home warranty companies offer plans that cover a specific list of kitchen appliances and laundry appliances, such as the items below:
Providers also offer plans that cover major systems, such as HVAC, plumbing and electrical systems. Components that may be covered under a systems plan include the following:
Most providers offer plans that cover both major appliances and systems. These are sometimes called “whole home” or “premium” plans, depending on the provider, and typically cost more than plans that cover only appliances or systems.
In addition, most providers offer add-ons that cost extra. These may include coverage for roof leaks, septic systems, an annual HVAC tune-up, a separate guest unit and a color-matching guarantee for new appliances.
Most home warranty providers exclude coverage for items that are broken or malfunctioning before the contract’s effective date, typically referred to as “items with preexisting conditions.” Many providers also limit claims within the first 30 days of the contract’s term.
Read a sample contract to learn what is and is not covered by the specific home warranty you’re interested in. Most providers include a list of covered items and exclusions. Some companies, such as American Home Shield, provide an itemized list of what is and isn’t covered in their sample contracts, plus coverage limits for each item.
A home warranty covers different forms of loss than homeowners insurance. While a home warranty is optional, many mortgage providers require homeowners to carry home insurance during their loan terms.
Home insurance covers loss related to storm damage, fire, theft or other types of damage to the physical structure of the building. On the other hand, a home warranty covers specific items within the home or the systems that make a home liveable, such as HVAC, plumbing or electrical systems.
If you’re considering buying a home warranty, three factors should guide your research: your coverage needs, your budget and the reputations of home warranty providers. Here are the steps to take before purchasing a home coverage plan.
To determine what items or systems in your home need coverage, make a list of the most-used appliances and systems in your home. Find out whether a manufacturer’s warranty covers them, and if so, how much time is left on the agreement.
If one or more of your major appliances or systems are out of warranty, you may want to consider purchasing a home service plan to guard against unexpected expenses in the event of a breakdown.
If your appliances or home systems are out of warranty, consider how much it might cost to repair or replace them without a warranty. In some cases, the annual premium for a home warranty may be higher than the cost to repair or replace a failed appliance.
Weigh the potential risk of a high-cost repair or replacement against the peace of mind that a home warranty may provide. As you analyze your finances, determine how much you can afford to pay in monthly or annual premiums. Contrast that with how much you would need to pay out of pocket for a technician to fix a problem or how much a new appliance would cost.
Once you’ve determined the items or systems that need coverage and how much you can afford, request quotes from providers. Most home warranty companies offer estimates on their websites, including quotes for the following:
You’ll usually receive a quote immediately on the company’s website, but some companies require an email or phone call with a sales representative.
As you research each home warranty provider, become familiar with the terms of its agreement by reading a sample contract, if the company provides one on its website.
The typical sample home warranty contract will include the following sections:
If the home warranty company you’re considering doesn’t have a sample contract on its website, ask a sales representative to provide one.
Home warranty costs vary by provider, plan type and geographic region. We analyzed the price of premiums for nine of the leading home warranty providers and found that they charged a national average of $59 for monthly premiums and $703 for annual premiums.
In addition, every home warranty provider requires policyholders to pay a service call fee for each claim made during the contract. Service call fees range from $65 to $150, depending on the provider and plan.
As you consider your budget for a home warranty, make sure to factor in coverage caps. Most companies only cover up to a certain amount per replacement or repair, which means you might have to pay for the balance out of pocket.
A good way to gauge if a home warranty is worth it is to weigh the monthly or annual premiums against the potential replacement or repair costs for the items or systems you’d like covered.
The price range for a new appliance varies by manufacturer and by the quality of the item. For example, we analyzed the retail cost of new refrigerators listed by five of the leading manufacturers: LG, GE, Maytag, Whirlpool and Samsung. Their prices ranged from $643 to $7,999.
Home systems carry an even steeper price tag. Our November 2023 survey of 750 homeowners found that nearly 50% reported paying between $2,000 and $9,999 to replace their HVAC systems.
Independent online consumer guides can provide unbiased information about home warranty providers. Our team conducts in-depth, up-to-date research on the state of the home warranty industry to make impartial recommendations for the best home warranty companies.
You should also conduct your own research to ensure you choose a provider that fits your needs.
Consumer review sites such as the Better Business Bureau and Trustpilot provide a good starting point for your research into home warranty companies. Don’t place too much stock in the number of favorable or unfavorable reviews. After all, most customers are motivated to leave reviews for a service provider when they have a bad experience.
Rather, look for patterns in the topics and themes of positive and negative reviews. The following review topics should give you pause:
In addition to online review sites, seek recommendations from friends, family members and neighbors who use home warranties.
Unfavorable ratings and customer reviews are the most obvious red flags, but dig deep in your research to determine whether the company you’re considering backs up its promises with a workmanship guarantee. Not every home warranty company does this, but some offer generous workmanship guarantees of 30, 60 or even 180 days.
Many states regulate the home warranty industry by statute. To learn whether your state does this, search for your state’s consumer protection office using USA.gov. If you’re unsure whether the company you’re considering meets your state’s regulatory standards, ask a sales representative before signing the contract.
A home warranty can mitigate stress and potentially save you money on repairs or replacements. But for that to happen, you need to know how your home warranty works.
If you have a breakdown, such as a malfunctioning AC or a broken refrigerator, you’ll want to file a claim with your provider. But first, make sure you have a copy of your home warranty agreement on hand and read the fine print to double-check that your contract covers the broken item.
Then, follow the instructions in your contract on how to file a claim. Most home warranty companies provide an online form that can be accessed through your account. Some require phone or email contact.
Provide as much detail as you can about the problem. Take photos if you can and present them to the warranty provider. Find the broken item’s purchase history, along with any maintenance history.
Once you’ve filed your claim and paid your predetermined service call fee, the rest is up to your technician to fix the problem and your warranty provider to cover the cost (up to the item’s coverage cap). This is why you bought the home warranty in the first place: to let someone else handle the aftermath of a stressful breakdown.
Your responsibility as a homeowner does not end entirely with filing the claim. Remain diligent to ensure that the provider and the technicians live up to their end of the contract.
Keep track of all communications with the warranty provider and the assigned technician. Chances are, you’ll need to set the appointment with the technician and clear your schedule to be available for the service call.
Monitor how much time it takes for the warranty provider or technician to respond to your inquiries. If there’s a contractually agreed-upon response time, make note of that. Most providers promise response times between 24 and 48 hours.
Remember that your home warranty provider limits the amount of money it will pay for repairs or replacement. You will need to pay the balance if the cost exceeds that limit.
Make note of any workmanship guarantee in your warranty policy and monitor the repaired or replaced item throughout the term of the guarantee.
Avert any homeowner headaches by conducting thorough research before you purchase a home warranty. Start by identifying your coverage needs and analyzing your household budget to determine what you can afford in premium payments. Be sure to compare the deals available from multiple home warranty companies.
Request at least three quotes from reputable home warranty providers, and choose a trustworthy company that gives you the most comprehensive home warranty coverage at the best price.
Editorial note: The name “Homefront” refers to the alliance between USA TODAY and Home Solutions that publishes review, comparison, and informational articles designed to help USA TODAY readers make smarter purchasing and investment decisions about their home. Under the alliance, Homefront provides and publishes research and articles about home service and home improvement topics.
Homefront has an affiliate disclosure policy. The opinions, analyses, reviews or recommendations expressed in this article are those of the Homefront editorial staff alone (see About Homefront). Homefront adheres to strict editorial integrity standards. The information is believed to be accurate as of the publish date, but always check the provider’s website for the most current information.
Overall, 2-10 Home Buyers Warranty is our top choice because of its unlimited workmanship guarantee, low plan premiums and service fees. As a homeowner, you have to deal with the occasional unexpected expense. For a monthly or annual premium, a home warranty can offset the financial burden of repairing or replacing your most-used systems and…
As a homeowner, you want to protect your home from the unexpected. This especially rings true if you own an older home with aging major appliances and systems. A home warranty can provide peace of mind by reducing the cost of repairing or replacing your home items. However, what exactly makes a company one of…
Our research shows that, on average, home warranties cost $93.75 per month and $1,032.75 per year. We obtained our averages via our November 2023 survey of 1,000 homeowners. We also requested quotes from many of the home warranty companies we’ve reviewed to calculate national averages, although this yielded different results — $58.55 per month and…
Homeownership presents its share of challenges, including unexpected repair costs. A home warranty provides a financial cushion for the high expenses associated with appliance and system malfunctions. Before you buy a home warranty plan, you’ll need to conduct rigorous research. Seek to answer the following questions: With careful planning and consideration, buying a home warranty…
TEST Our editorial team is committed to creating independent and objective content focused on helping our readers make informed decisions. To help support these efforts we receive compensation from companies that advertise with us.
The compensation we receive from these companies may impact how and where products appear on this site. This compensation does not influence the recommendations or advice our editorial team provides within our content. We do not include all companies, products or offers that may be available.