A home warranty is a separate protection plan from your home insurance policy that provides coverage for your home’s internal systems.
From weather-related damage to broken-down appliances, there are plenty of issues that can pop up in your home throughout your mortgage. And no matter how dedicated you are to your monthly home maintenance plan, it never hurts to have a little extra coverage. And no, we aren’t talking about home insurance (although that’s important too).
Outside of your home insurance policy, you have another option to provide your home with even more protection. Learn everything you need to know about home warranties, how they differ from home insurance and which choice is right for you below.
The main difference between a home warranty and home insurance is that insurance covers your home's structure and contents from specific perils, while warranties cover your appliances from old age or general wear and tear. Home insurance is also required when purchasing a home, while a home warranty is optional.
Both cover items in your home, have yearly premiums and cover some (but not all) of your appliances.
A home warranty is a separate protection plan from your home insurance policy that provides coverage for your home’s internal systems from typical wear and tear. Think of home insurance like going to the doctor for a checkup and a home warranty like taking care of your body with healthy eating and exercise. While going to the doctor is important, eating right and exercising are great supplements to keep your body running smoothly in-between visits.
Home warranties allow you to pay a flat fee for repair services on your appliances, plumbing or electrical systems. Typically, a home warranty program lasts for an entire year and costs an average of $300 to $600 a year (according to Consumer Affairs).
Home warranties allow you to pay a flat fee for repair services on your appliances, plumbing or electrical systems.
A home warranty typically covers your home's appliances, electrical and plumbing systems as well as HVAC units. Though it's worth noting that what home warranty covers depends on the type of policy you buy. Most companies offer several plans for total customization, allowing you to only cover your appliances or just your internal systems (or both). Make sure to read the fine print before purchasing a policy because while home warranties cover the repairs of rundown items, they don’t cover the damage they cause to the rest of your home.
When researching a home warranty policy, you’ll have the option to cover some (or all) of the following:
Deciding whether or not to get a home warranty comes down to personal preference. While home warranties help minimize extraneous fees related to repairs, they don’t cover everything. To help you determine if a home warranty is right for you, consider these pros and cons:
Home warranty pros:
Home warranty cons:
Home insurance is a required policy that protects your home’s structure, your belongings and liability from damage that occurs from covered perils. But home insurance doesn’t cover everything, and any damage that occurs to your appliances from old age is on you to fix. That’s when having a home warranty policy can come in handy.
Technically, you don’t have to get a home warranty if you have homeowners insurance. And while home insurance is usually required when you own a home, there may be gaps in your home insurance coverage. If you want to make sure you don’t experience any financial surprises, you may want to consider additional coverage options, like a home warranty. It’s worth talking to your insurance provider about their additional endorsements as well. Riders like equipment breakdown coverage can add a lot of the same protection as a home warranty for a fraction of the cost.
Here at Hippo, we know that home is where the heart is. And protecting your heart is our top priority. From full-coverage home insurance plans to insurance riders to fill in any gaps in your policy, a policy with Hippo makes a beautiful melody, ensuring you’ve got coverage for every portion of your home.
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