What They Cover

Unlike homeowner's insurance—which covers theft and damage to your property caused by fires and storms—home warranties will take care of appliances and mechanical ­systems that might break down because of normal wear and tear. A basic policy costs somewhere between $300 and $500 a year and covers plumbing, electrical work, HVAC ­systems, and most major appliances (washers and dryers may be excluded). You can ­also buy additional coverage, a la carte, for things like hot tubs and swimming-pool mechanicals. If something goes wrong, the policyholder simply calls the warranty ­com­pany, which then dispatches an approved contractor to inspect the damage. If it's covered, the homeowner pays a deductible of around $30 to $50—and the repair or ­replacement is done free of any ­additional charge.

Home warranties aren't just for buyers and sellers. They're great for homeowners as well—especially if they live in older houses. Say you purchased your house 10 years ago. Even though you've taken good care of it, some of the systems and appliances are probably showing their age. Shelling out for a warranty could work in your favor, since most companies that offer them don't take the age of covered items ­into account. So if your furnace dies, and your warranty picks up the $2,000 it would cost you to replace it, the ­policy more than pays for itself.
Ask TOH users about Appliances

Contribute to This Story Below