Having home appliance insurance, also called a “home warranty,” can be a great investment if you don’t have money saved for unexpected home repairs and replacements. It can also provide peace of mind that if something were to break in your home, you’d be covered. In this guide, we’ll discuss what home appliance insurance is, how coverage works, and how to find the best home warranty for you and your home.
Top 3 Home Appliance Insurance Providers
- American Home Shield: Best Overall
- Choice Home Warranty: Best Service
- First American Home Warranty: Best Value
American Home Shield
American Home Shield (AHS) is our top pick for comprehensive coverage. AHS is accredited by the BBB and holds a B rating with the company. It’s also one of the oldest home warranty providers in the industry and serves all states except for Alaska.
Pros and Cons of American Home Shield
|✔ Has generous coverage caps||✘ Not available in Alaska|
|✔ Does not require maintenance records||✘ Repairs only guaranteed for 30 days|
|✔ Allows customers to choose a $75, $100, or $125 service fee||-|
Choice Home Warranty
We recommend Choice Home Warranty (CHW) for its excellent repair guarantee.
Pros and Cons of Choice Home Warranty
|✔ More affordable plans than competitors||✘ Not available in California or Washington|
|✔ Home inspections aren't required for coverage||✘ Doesn't allow customers to choose their own technician|
|✔ Free repairs within 90 days if an item breaks down after a repair||✘ Doesn't allow customers to customize their plans|
First American Home Warranty
Additionally, we recommend First American Home Warranty (FAHW) for its affordable plans.
First American Pros and Cons
|✔ Affordable monthly premiums||✘ Not available in the following 15 states— AK, CT, DE, HI, IL, LA, ME, MA, MN, NH, NY, ND, RI, VT, or WI|
|✔ 24/7 ability to submit a claim||✘ Air conditioning is only covered if purchased through an optional add-on|
|✔ Covers systems and appliances that were improperly installed or maintained||✘ Doesn't provide coverage for roof leaks|
Compare Home Appliance Insurance Companies
Use the table below to compare our picks for the top home appliance insurance companies. American Home Shield stands out for its comprehensive coverage, while Choice Home Warranty offers a reliable repairs guarantee. If you’re on a budget, though, First American is the most wallet-friendly.
|Providers||American Home Shield||Choice Home Warranty||First American Home Warranty|
|Providers||American Home Shield||Choice Home Warranty||First American Home Warranty|
|Get a free quote||Visit site||Visit site||Visit site|
|Best home warranty for||Coverage||Repair guarantee||Value|
|Plan options||3 + optional add-ons||2 + optional add-ons||3 + optional add-ons|
|Availability||Not available in AK||Not available in CA, OK, or WA||Not available in AK, CT, DE, HI, IL, LA, ME, MA, MN, NH, NY, ND, RI, VT, or WI|
For information on other top home warranty companies, read our in-depth reviews:
What Is Home Appliance Insurance?
Home appliance insurance, also known as a home warranty, is optional insurance that covers repairs or replacements on major home appliances and systems. Home warranty policies are typically purchased by people who want to avoid the costs associated with unexpected breakdowns of expensive items within the home or those who just want an added layer of protection on systems and appliances.
This type of insurance is optional as opposed to a homeowners insurance policy, which is required by a mortgage lender. To receive coverage, homeowners will need to only pay a monthly or annual premium and a one-time service fee for every claim made.
What Does Home Appliance Insurance Cover?
Rather than protecting the structural integrity of a home like homeowners insurance, home appliance insurance covers the cost of repairs or replacements for appliances and systems.
Each covered system or appliance has exclusions and limitations, so be sure to review the terms and conditions of your home warranty before opting into a policy.
In general, home warranty companies provide a variety of plans: systems plans, appliances plans, combo plans, and build-your-own plans.
Systems plan covers:
- Air conditioning
- Heating system
- Electrical system
Appliances plan covers:
- Clothes washer/dryer
- Built-in microwave
- Other important appliances
Combo Plan covers:
- A combination of both systems and appliances
Build-Your-Own Plan covers:
- Whatever systems and/or appliances the homeowners decides need coverage
How Much Does Home Appliance Insurance Cost?
The average cost for basic to comprehensive home warranty coverage typically ranges between $300 and $600. Pricing for a home warranty will depend on the company you go with, the coverage you choose, and where you live.
While the monthly premium is usually the most expensive factor when buying a home appliance warranty, there are other costs to consider.
- Service call fee—This fee is paid when a service technician comes to your house to inspect a broken system or appliance. Most service fees range between $75–$125.
- Enrollment fees—Check with your potential home warranty provider to determine if they require a one-time enrollment fee upon signing up.
- Cancellation fee—If you choose to cancel before a contract expires, you should expect to pay an early termination fee. The average cancellation fee for customers who cancel after 30 days of coverage is $75, but it can range between $25–$90 depending on the company.
We recommend getting quotes from a few different providers to negotiate pricing and get the best deal. We also recommend asking about current home warranty offers and promotions, as some companies, like Choice Home Warranty, will offer free coverage for a couple of months.
How Does Home Appliance Insurance Work?
Customers can file a claim on covered systems and appliances once coverage begins (usually 30 days after signing a contract). The home warranty company will typically take 24 hours to approve a claim and will then send a contractor to inspect the issue within 48 hours of the claim being filed. If the issue is covered per its terms and conditions, homeowners are only responsible for paying a trade service fee when the technician arrives at their house.
What to Consider When Buying Home Appliance Insurance
Before buying a home appliance insurance policy, there are a variety of factors to consider, such as cost, coverage, customer service, and claims processes. Here are some tips to keep in mind when searching for a home protection plan that’s right for you:
- Think about the coverage you need—Evaluate which items in your home need the most protection. Do you have only a few appliances that are aging and need protection or do you need comprehensive coverage for both systems and appliances? Once you know which items you want covered, compare plans and choose an option that provides the coverage you need.
- Determine the coverage limits in your policy—Home warranty companies will set coverage limits on certain items in the policy and require homeowners to pay the remaining cost once a limit is reached. For example, if there’s a $2,500 limit on air conditioning and heating for the contract term, customers are responsible for paying any costs that exceed that amount.
- Figure out how the claims process works—Most home warranty providers will approve claims within 24 hours and send a contractor to inspect your appliance or system within 48 hours. However, this isn’t a guarantee among all companies, and some providers will wait as long as four days to send a contractor to help you.
- Read trusted, third-party reviews—It’s a good idea to read trusted customer reviews from sites like the Better Business Bureau (BBB) before signing up for a home warranty. This gives you another perspective from consumers who have held policies with the company you’re thinking about purchasing from.
When to Buy a Home Warranty
While home warranties are often purchased during real estate transactions, they can be bought at any time during homeownership. This is especially true for homeowners who live in older homes with aging appliances—the assistance for financial support during sudden breakdowns helps policyholders protect their budget.
One of the best times to buy home appliance insurance is when you notice your equipment is beginning to age—not after it starts experiencing problems.
Frequently Asked Questions
Is a home warranty the same as home insurance?
A home warranty and home insurance are similar, but they protect different items. A home warranty covers systems and appliances, while home insurance protects your home in the event of structural damage from fires, natural disasters, and theft.
Homeowners insurance is sufficient protection against these emergency scenarios, but it offers no protection for appliances and systems. To obtain the best home appliance insurance and coverage for whole-home systems and appliances, we recommend buying a service contract from a reputable home warranty company like American Home Shield.
What’s the difference between a home warranty and a manufacturer’s warranty?
A home warranty covers systems and appliances that break down due to normal wear and tear, while a manufacturer’s warranty is a type of factory warranty that covers the repair costs of issues that arise in a newly purchased appliance. Since insurance for a covered appliance can vary drastically between manufacturers, it’s essential to understand the limitations and exclusions featured in the warranty.
Depending on the manufacturer, the agreement may cover parts for several years, while labor recovery is much more limited. Typically, specific components are protected from early failure but not for wear and tear.
Do I need a home warranty if I have an extended warranty?
When buying an appliance, you’ll likely be asked about investing in an extended warranty. Typically, this increases the length of time protection is offered for a covered appliance, but it doesn’t provide more extensive coverage for different parts or labor and typically won’t cover items that break down due to normal wear and tear.
How much should I expect to pay for a home warranty?
On average, home warranties will cost between $300–$600 a year, with deductibles ranging between $75–$125. The total cost of your home warranty, however, will depend on the policy you choose, where you live, and how many add-ons you include in your plan.
Can I purchase a home warranty after closing?
While most home warranties are purchased during the homebuying process, a home warranty can be bought at any time during homeownership.
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