15 Things You Should Know About Home Warranties 

Greg Wilson

Updated on:

American Home Shield home warranty

    If you're in the market to buy a home or recently purchased a home, maybe you're considering if you should get a home warranty. Home warranties protect your major appliances and systems like AC, electrical, plumbing, dishwashers, and refrigerators. On average, home warranties cost $300 to $600 every year for a comprehensive plan; according to Consumer Affairs, this is about $25 to $50 a month.

    The warranty company is an insurance company, so you'll have to prove your claim and back it up with maintenance records if applicable. 

    The seller could cover a home warranty and is a negotiable item in a real estate contract.

    How Do Home Warranties Work? 

    If one of your covered appliances or systems breaks down, you'll pay a service fee for a technician to evaluate the situation usually; this fee is $65 to $125 or more. Home warranties have multiple tiers, the premium tiers cover add-ons like pool and spa, but these plans cost $720 to $1800. 

    Home Warranties May Be Redundant

    Sometimes, they are covered under warranty for a year if you're purchasing a new home. If the appliances in your home are new, they may have a warranty as well, which is why you'll want to find one that compliments your homeowner's insurance policy and does not overlap on the coverage.

    Keep in mind that some home warranty coverage can be complex, and may not cover appliances and systems that aren't properly maintained. Instead, you have to read all the terms carefully and completely understand what it covers. Some warranties only cover certain brands. 

    Your out-of-pocket costs can still be high.

    Some home warranties only cover repairs, not replacements, so if the item is beyond repair, you'll need to replace it yourself. Other policies have high deductibles, so check out the maximum amount a plan covers per item. 

    Are Home Warranties Worth it? 

    When you consider all the costs of maintaining your home systems and purchasing nice appliances, we present some pros and cons to consider, and you can decide if a home warranty is for you. 

    A home warranty gives you peace of mind knowing your appliances are covered. Sure, you hope that you won't have to make a claim, but if something happens, you'll have access to someone who can repair them if needed. With this, you don't have to worry about repair costs.

    When it comes to owning a home, unexpected things will happen, and things will eventually break — it's inevitable. If something happened, you could reach into your pocket and purchase new appliances and buy the latest HVAC system, but that's a hefty price tag, especially for retired or seniors. 

    Here are the average cost ranges to repair or replace typical household items:

    • A/C Unit: $150 – $3,800
    • Heating and Ductwork: $105 – $3,625
    • Refrigerator: $200 – $1,500
    • Water Heater: $240 – $1,200

    Now, that's just the average range for repair or replacement; those numbers don't consider the hidden costs of a broken household system or appliance. For instance, when kitchen appliances go out, you'll get wasted groceries and find yourself eating out. Washer and dryer out? Gas to your friend's or family's house or the coats of a laundromat. It's a trickle effect that adds up.

    You can make sure you're covered when a breakdown happens by finding a company that you can trust and a home warranty plan that's right for you.

    With over 50 years in the industry and over 1.8 million members, American Home Shield is just what you need. Not like homeowner's insurance, American Home Shield provides plans for people who have systems and appliances they'd like to keep in working order; plus, no system or appliance is too old when it comes to their plans. Also, no maintenance records or inspection is required, just protection regardless of the age or appearance of your covered items.

    • Heating & Cooling (HVAC, A/C units & heat pumps) 
    • Electrical Systems (Wiring, fuse boxes & outlets)
    • Plumbing Systems (Water heater, pipes, well & septic pump)
    • Kitchen Appliances (Refrigerator, oven, range & microwave) 
    • Laundry Appliances (Washing machine & clothes dryer)

    Rest easy that you'll be taken care of when something goes wrong. And, with American Home Shield, if they can't repair your covered item, they'll replace it. 

    The fact is that household breakdowns are complicated and tend to come when you least expect it or need it. So when you have American Home Shield, getting the help you need is easy. So head over to their site today to check out their flexible plans and see how you can keep your house running and your wallet happy.

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    A home warranty is worth it if you need coverage for your appliances and home systems, and you find a plan that includes the items you want to be covered, so you end up saving money instead of wasting it. 

    If you buy a home that's been lived in, you don't know what you're getting, so buying a home warranty is a wise choice. Of course, you could always try it for a year or two and see if it works for you, allowing you to learn more about your new homes' systems and appliances; you could always cancel later. 


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