Home warranties are service contracts that can help homeowners to cut their costs of home system and appliance repairs. These plans are versatile and offer different types of protection. But not all home warranty providers are reliable. Therefore, to choose a plan that will really save you money, you need to understand how they work and what to look out for.
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How Do Home Warranties Work to Save Your Money?
A home warranty contract offers coverage for a variety of home systems (electrical, plumbing, etc.) and appliances (oven, fridge, microwave, etc.). Some companies offer plans that cover only appliances, and there is a lot of variation for optional coverage. Overall, it shouldn’t be hard to find or customize a home warranty plan that will cover exactly what you need.
The average cost of this plan is $400-600 a year. Considering that the average cost of a single appliance repair is about $200 and systems cost even more, home warranty coverage makes sense.
Should any of the covered items break down, the warranty provider will cover the costs of repair, as well as send in the contractors, so you are saving time as well.
The problem here is that some home warranty companies can’t be trusted. Claim denial is the most common issue with them. Some of the cases get so serious that homeowners are taking them to court.
In order to avoid wasting your money on a plan that doesn’t work, you should choose it carefully. The important questions to ask are “how long home warranties last for?” and “how to cancel home warranty coverage?” You also need to research the warranty provider to learn their reputation. You can do this kind of research online easily. Just check the company’s reviews on platforms like Yelp and its rating and number of resolved complaints on the Better Business Bureau website. Finally, google the provider’s name and study news about the company available online. This will allow you to discover if the company was a part of any scandals that ended up in court.
How to Look for in a Good Home Warranty Plan: Duration, Coverage, Terms & Conditions
A home warranty plan you can trust should offer extensive coverage without exceptions. For example, if it covers AC repairs, it must include all repairs and not exclude expensive jobs like a replacement of the cooling system. Study the Terms and Conditions of the plan with extreme care to understand exactly what is included in this coverage.
The majority of plans last for a year, but many companies offer an opportunity to pay for coverage in monthly installments.
You also need to note that home warranty plans usually activate a month after you purchase them. The provider uses this time as a buffer to see if any “pre-existing conditions” will emerge. If your appliance breaks down during this period, the company won’t pay for repairs. “Pre-existing condition” is one of the most common reasons for claim denial.
Finally, check the home warranty contract termination terms. Usually, you will need to file for contract termination about a month in advance to cancel the automated renewal. Make sure those terms are reasonable so you don’t end up paying for another year’s worth of coverage you don’t really need.
In Conclusion: Do You Need a Home Warranty?
Being a homeowner is expensive, so looking for ways to cut down some costs is always wise. A home warranty plan can help you achieve this if you choose it wisely. Remember that this type of protection will only benefit you when it’s provided by a company you can trust follow through on its promises and stick to the terms of the contract.