Home Warranty Extends Confidence to New Home Owners

Many people wonder whether they really need home warranties. One way to decide is to evaluate the cost of repairs to major systems and appliances should they fail. Heating systems may cost more than $1,000 to replace, while a hot water heater is likely to cost more than $400. You could spend thousands more if your electrical systems, plumbing, range or refrigerator need to be replaced. Compare this likely cost with cost of an annual premium and a service call charge, and you will be able to judge whether it's worth it to get a home warranty.

Even new homes are not excused from troubles that can lead to pricey home repairs. Things like your appliances and other important systems can and do break down. Once you've invested so much money just getting into your home, it can be an unwelcomed event to have to spend more money on repairs. Having a home warranty lets you enjoy your home without worrying about spending thousands of dollars on repairs, as long as you get a quality home warranty. Although a home warranty can protect you from some of the things that home owners have to face, it is important to know what you are doing before you make the buy.

Home warranties may be provided by home builders. Some states mandate a minimum warranty on the construction of your home, which may be valid for as many as ten years. However, most of these warranties may only cover the appliances and systems in your home for a year or two, if at all, with most of the protection aimed towards structural deficiencies, should they occur. If your builder completes the neighborhood project and moves on, you may also find it difficult to make a claim. The cost of builders' home warranties - even if these are provided by a third party - will usually be included in the price of your home. Individual third-party home warranty policies are also widely obtainable. These are warranties which you purchase yourself. Although they may cost a few hundred dollars a year, the expense may be well worth it, depending on the cost of the repairs needed to your home. Third-party home warranty policies usually last for ten years, and may cover a range of items.

When choosing home warranties, it is vital to look at the fine print and see exactly what your policy includes - and, more importantly, what it excludes. It is essential to understand how a home warranty policy functions. When an appliance or system breaks down you contact your particular home warranty company. The company then contacts the service provider, who repairs or replaces the system or appliance. It is your responsibility to pay for the service call charge, which is usually less than $100. Items typically covered by home warranties include air conditioning, heating systems, fridges, ranges, ovens, refrigerators, fans, indoor plumbing, electrical systems, garbage disposal and telephone wiring. Not all plans cover all these items, and many outdoor systems may be excluded. Check your individual home warranty for guidelines on your responsibility to maintain equipment, as failure to do this or abnormal wear may nullify your policy.