June 1, 2023
Believe it or not, your typical homeowners policy doesn’t cover EVERYTHING. Crazy right?! I’m sure you all can read the sarcasm right now but it’s true.
A tool, or policy if you will, that you can purchase to fill in some gaps in coverage is a home warranty program. There are several companies out there that sell these. A few of the big ones are American home shield, Fidelity, First American and a ton others. If you google “home warranty companies” you’ll be able to find a ton and do some research to find what’s right for you. So, what is it and why do I need it? A home warranty is a service contract designed to repair and/or replace what’s on their program. It all depends on the company and the product you select so do some research but I’ll give you some basic info. They typically cover appliances, heating and A/C systems, garage door openers, even ice makers. Basically the wear and tear stuff that isn’t covered by your home insurance policy.
So how does it work??
Home warranty is typically come in three packages: appliances, systems and combo plans. Let’s break these down a little bit.
Appliances: This covers (you guessed it) your appliances! Stuff like your refrigerator, washer and dryer, your oven, dishwasher etc. If something happens you typically pay a service fee, kind of like a deductible, to have somebody come out and look at it. They’ll do a determination to see if it can be repaired or if it needs to be replaced.
Systems: When you think of systems think of the guts of your house. Stuff like your electrical, plumbing, heating and AC systems and so forth. Just like the appliances, do you pay a service fee for somebody to come out and take a look at what’s going on and make a determination of what needs to be done.
Combo Plans: these are actually really cool and this is what I personally have. You have options of all appliances and systems and get to pick and choose what you want covered. With the program I have, there are 16 choices and you get to pick 10 between appliances and systems. You also get to pick the service fee amount, higher the service fee means lower the price and vice versa. Just like an insurance deductible!
There you have it, a basic overview 101 course of what home warranties are and how they work. Definitely take some time and do some research on your own for companies and pricing that’s right for you. Also, ask questions and read the fine print. You don’t want any surprises like a non-renewal if you use the home warranty too much. Just ask my mom, yep, she got non-renewed from her company. I think it’s a good idea to start thinking about something like this as your house gets older. As your house gets older things start happening and little problems start occurring. A home warranty can definitely come in handy to fill in gaps that your home insurance doesn’t cover. They’re usually around $500 a year or so depending on the product and company.
Check it out and have some more peace of mind. Remember we’re always here to help and if something goes wrong… don’t sweat it!