Your home likely represents the most significant investment you'll ever make, so protecting it is essential. Keeping a home in good shape ensures property values stay as high as possible, but it also means making professional repairs whenever needed. Upkeep can get expensive, but a home warranty helps defray some of the most significant costs and provides a safety net in emergencies. The peace of mind a contract offers is invaluable.

What Does a Home Warranty Provide?

While homeowner's insurance and a warranty protect against unexpected costs, there are significant differences. Home warranties cover various items, including HVAC and electrical systems, water heaters, and plumbing. You typically purchase a warranty for a year and then renew it annually.

In contrast, insurance pays for damages and losses caused by forces such as weather, fire, or vandalism. Coverage is designed to help you replace damaged or lost items and rebuild them if needed. If a car crashed into your home and damaged the kitchen appliances, the insurance would pay for them. However, appliance breakdowns are not covered.

A warranty will pay expenses when covered items stop working due to wear and tear. For example, a 2-10 HBW warranty can include your water heater, washer, dryer, stove, or furnace. Policies vary widely, and homeowners can choose which systems to include. A home warranty can cover items no longer under a manufacturer's warranty.

Repairs Can Be Costly

A home warranty is a good choice for new homeowners who invested a lot of money in their purchase and must budget carefully. This is especially crucial when buying an older home with out-of-warranty appliances and systems. A single appliance breakdown can create unexpected financial strain.

According to Forbes, a home warranty means fewer unanticipated costs, making financial planning easier. When you buy the policy, you learn the premium costs upfront. The warranty also spells out the deductible for repairs covered under the warranty.

Reduce Unnecessary Stress

A home warranty minimizes sudden appliance or system breakdown stress. There's no need to search for a reputable provider to make repairs. The warranty company spells out the repair procedure upfront.

Home warranty clients immediately contact the warranty company when there is a breakdown. The company will put you in touch with a contractor who diagnoses the problem and provides their findings to the warranty issuer. They evaluate the claim and then fulfill the coverage included in the service agreement. Clients always get professional service and results.

Selling Your Home May Be Easier

Per Bob Vila, sellers who buy a year of home warranty coverage can often entice house hunters. Many buyers shy away from older appliances and systems no matter how well-maintained the home is. Many budgets for mortgage payments and related expenses try to minimize unexpected costs. A warranty reassures them that breakdowns are covered during their first year of ownership.

A warranty can also be valuable for sellers who have prepared their home and need coverage in case something breaks before they sell. Homeowners' insurance will pay for damages caused by problems like a burst pipe but may not cover the cost of needed system repairs or updates. A warranty with plumbing coverage helps owners avoid those expenses.

A home warranty can pay for the bulk of costs associated with appliance and system breakdowns. It covers sudden expenses when older, out-of-warranty appliances break down and offer peace of mind. Selling a house can also be more accessible when owners provide buyers with a home warranty.