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Home Warranty Cost Calculator

Author Icon By Dana Getz Updated 01/14/2024

Our team created a cost calculator to help you estimate the annual cost of a home warranty plan. Enter your monthly cost, service call fee, and expected number of claims, and click on “calculate.” Our calculator will display a ballpark figure of the amount you’ll pay for your home warranty annually. This calculator is intended for research purposes only. It’s best to request a quote directly from our recommended providers, as annual costs and service fees vary.


Home Warranty Costs

Several factors impact how much a home warranty costs. Generally, providers that offer comprehensive coverage cost more than those that offer basic coverage. Where you live, the type of home you own, and your home’s size also affect plan costs.

Here are several fees to expect after purchasing home warranty coverage: 

  • Monthly fee: When signing up, you can choose a monthly or annual premium. Policies typically last up to 12 months, although you can purchase additional 12-month terms.
  • Service call fee: Besides monthly premiums, you must pay a service fee to use your home warranty plan. Your provider will charge you the established service call fee whenever you request service. Many providers include a workmanship guarantee for completed repairs. This guarantee ensures you don’t pay another service fee if a repaired home system or appliance breaks down within a set time frame.
  • Miscellaneous fees: Depending on the issue, home warranty providers may charge you additional fees to fix your major system or appliance breakdown. For example, if your provider’s service technician needs to remove your home appliance, you are responsible for the removal fees. Additionally, some providers only cover the cost of components, not the labor to install them. Carefully review your service contract to understand the exact terms and limitations.

Cost Calculator Formula

The formula we used in our calculator is as follows: 

  • Monthly fees (multiplied by 12) + service call fee (multiplied by the estimated number of claims) = projected annual cost 

This formula can help you visualize the expected cost of a home warranty protection plan over the course of a year. We paired a table displaying the average repair and replacement cost figures for common major appliances next to the calculator for a quick cost comparison. 

How Our Cost Calculator Can Help

Our calculator is a tool you can use to determine if a home warranty is right for you. Say you own an American Home Shield plan that costs you $50 monthly and includes a $125 service call fee. In this example, suppose you filed two claims for your dishwasher in a year. The estimated annual total you’ll pay American Home Shield is $850. According to our research, a dishwasher replacement costs up to $3,000.* A replacement dishwasher is nearly four times more expensive than the American Home Shield plan.

*Life span, repair, and replacement cost data sourced from InterNACHI and Home Depot


Choosing the Best Home Warranty

There are multiple factors to consider when choosing the best home warranty. First, consider your budget. According to our 2022 survey of 1,000 homeowners, more than 64% of respondents considered price the most important feature when shopping for a home warranty.

Alongside costs, consider your coverage needs. Take note of the home appliances and systems you use most frequently and wish to protect. Also, review the provider’s total coverage caps per covered system or appliance. For example, if you own pro-series appliances, a provider that offers higher coverage caps makes more sense than a budget home warranty with lower coverage limits.

Another factor to consider is provider reputation. We suggest reading a company’s customer reviews to understand how it handles customer service, disputes, and service requests. 

Finally, consider a provider’s claims process. Some providers require you to use in-network service providers for service requests, while others allow you to choose your own. Additionally, some providers offer multiple outlets where you can file claims. Others may only have one outlet.


Our Conclusion

Our home warranty cost calculator is one of many ways we aim to help homeowners make informed purchasing decisions. Use it to supplement your research when considering the best home warranty for your needs. We recommend requesting quotes from three providers to compare costs and coverage options before signing up with a home warranty company.


FAQ About Home Warranties

What is the difference between a home warranty and home insurance?

A home warranty covers the normal wear and tear of your home’s systems and appliances. Homeowners insurance, however, covers your home’s structure from damage caused by storms, wildfires, and other covered perils.

What is the average home warranty cost in the United States?

According to our research, the average cost of a home warranty in the United States ranges from $644 to $737 per year. Your price may vary based on your home size, type of coverage, chosen provider, and plan options.

Are home warranties worth the cost?

A home warranty could be worth the investment for someone who can’t afford an expensive appliance or home system repair. A home warranty could save you hundreds or even thousands of dollars in home repairs, depending on what items break down and your coverage. Each situation is different, so carefully consider your budget and needs. 

Do I need a home warranty when buying or selling a home?

You don’t need a home warranty when buying or selling a home. However, a home warranty can bring peace of mind to a new homeowner by covering their home’s systems and appliances within the length of the policy (typically the first year of homeownership). If you’re selling your home, owning a home warranty adds an extra incentive for buyers to consider your home over others, plus it raises the value of your home and could lead to a quicker sale.

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