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Do you really need that home warranty? How to find out if you do or don’t

Do you really need that home warranty? How to find out if you do or don’t

Home warranty serves a need that is not catered for by home insurance. Many homes have subscribed to this service where their appliances and systems are covered for repair in case they break down. Some people get good experiences from this service and others are dissatisfied. It is therefore important to evaluate yourself and see if you need the warranty or not.

Find out what the warranty covers

Different warranty providers cover different items for repair and maintenance. Some of the items covered are major appliances, electrical and heating systems. You would have to pay extra for coverage of other items not covered in the main policy. You should therefore assess what the warranty covers and decide if you have items that you may need to be covered. It is important to read the fine print when taking a home warranty. You may find that there are loopholes, which may make the provider not give you the service even after you have paid for it. For instance, the provider may give you the service only if you have upgraded your building to latest standards. In that case, even if you take the home protection plan, you may not benefit from it.

The cost of the warranty

The cost depends on a provider, and it consists of payment of an annual premium of between 250 to 600 US dollars. If there are more items to be added to the basic cover, then the cost increases. If there is a repair that is needed on the covered item, the home warranty provider settles the cost. You will be required to pay a trade fee of between 50 to 100 US dollars per repair visit depending on the company.To know if you need a home protection plan you should weigh the amount you are likely to spend on repairs in relation to the premiums you are supposed to pay. For instance, a policy of 700 dollars that you only use for minor repairs may seem too much while it is favorable if you have many repairs or even a replacement that is costing more.

For a new home with new appliances, chances of repairs and replacement are few. This means that you will end up paying more in premiums than you are getting in services. You may opt not to have the coverage. However, for a house with older appliances and systems, it would be better to have the warranty due to the large number of repairs expected.
A new house may also have a builder’s warranty that covers the first year and you may therefore, not need to take a home protection plan.

The services

If you have a warranty, you do not choose who does the repairs because the provider has its contracted repair technicians. You also do not have a say as to when the repair will take place. If you are uncomfortable with this aspect, it is best that you do not get a cover but pay for the repairs.

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