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.
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.
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
✔ Does not require maintenance records
✔ Allows customers to choose a $75, $100, or $125 service fee
✘ Not available in Alaska
✘ Repairs only guaranteed for 30 days
Learn More: American Home Shield Review
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
✔ Home inspections aren’t required for coverage
✔ Free repairs within 90 days if an item breaks down after a repair
✘ Not available in Washington
✘ Doesn’t allow customers to customize their plans
✘ Doesn’t allow customers to choose their own technician
Learn More: Choice Home Warranty Review
First American Home Warranty
Additionally, we recommend First American Home Warranty (FAHW) for its affordable plans.
Pros and Cons of First American Home Warranty
✔ Affordable monthly premiums
✔ 24/7 ability to submit a claim
✔ Covers systems and appliances that were improperly installed or maintained
✘ Not available in the following 15 states— AK, CT, DE, HI, IL, LA, ME, MA, MN, NH, NY, ND, RI, VT, or WI
✘ Doesn’t provide coverage for roof leaks
✘ Air conditioning is only covered if purchased through an optional add-on
Learn More: First American Home Warranty Review
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|
|Get Quote||Visit site||Visit site||Visit site|
|Best For||Best Overall||Best Basic Plan||Best Appliance Coverage|
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 plans cover:
- Air conditioning
- Heating system
- Electrical system
Appliances plans cover:
- Clothes washer/dryer
- Built-in microwave
- Other important appliances
Combo plans cover:
- A combination of both systems and appliances
Build-your-own plans cover:
- 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
Our Rating Methodology
The This Old House Reviews Team is committed to providing comprehensive and unbiased reviews to our readers, and we aim to provide transparency in our review standards and research process.
Our research process includes speaking with representatives from more than 40 home warranty providers, requesting quotes, and asking clarifying questions to gain insight into each provider’s benefits and downsides. We also analyze sample contracts from each company to understand specific coverage terms.
To rate companies, we apply the data we have gathered to our review standards. These standards are on a 100-point scoring system, which is detailed below:
- Coverage (35 points): Providers are scored based on breadth and depth of coverage. We focused on key home systems (HVAC, plumbing, and electrical), essential appliances (refrigerator, ovens, and laundry machines), and unique coverage items (such as roof-leak coverage and code violation allowances). Coverage scores are weighted by taking into account coverage caps and other limiting factors, meaning providers with greater range of coverage and higher coverage caps score the highest.
- Value (30 points): A company’s plan value is a reflection of how well it serves the customer in comparison to what the customer pays for the policy. We accounted for monthly costs, service call fees, and cost flexibility (such as customizable service call fees, discounts, and multi-year policies).
- Trustworthiness and Transparency (21 points): Trustworthiness and transparency are a reflection of how well the provider considers the customer’s interests. We scored items such as the length of workmanship guarantees, online availability of a sample contract, policy change flexibility, and ease of cancellation. Additionally, we scored items that reflect industry reputation and customer satisfaction, including analyzing brand reputation across the Better Business Bureau and third-party customer review aggregators.
- Availability and Service (14 points): Quality of customer service is key to customer satisfaction. We dug into each provider’s guaranteed response times, claims processes, service flexibility, emergency availability, and more.
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