Home Insurance in 10003>Question Details

Ruth, Home Buyer in San Francisco, CA

What is a home warranty? Do I need one?

Asked by Ruth, San Francisco, CA Fri Feb 11, 2011

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A home warranty is essentially an insurance policy that covers identified aspects/systems(HVAC, appliances, pool, etc.) of the home.

As far a needing a warranty, comedian Flip Wilson said it best....."you are betting that something bad is going to happen, while the insurance company is betting it will not......"

Keep smiling,

Bill
1 vote Thank Flag Link Fri Feb 11, 2011
Ooops....Thanks Spirit!

Sorry
0 votes Thank Flag Link Fri Feb 11, 2011
Hi Bill, I enjoyed your answer so much I gave you the thumbs up.
Spirit
0 votes Thank Flag Link Fri Feb 11, 2011
Ruth,

Thanks for the thumbs up!

Bill
0 votes Thank Flag Link Fri Feb 11, 2011
A home warranty is a service contract covering the repair and or replacement cost(s) of home appliances. These can very but generally covers equipment and appliances such as dishwashers, stoves, plumbing systems, and etc. that fail due to "normal wear and tear". Coverage varies significantly across warranty companies. Home warranty contracts do not cover all home repairs.


There are several companies’ that provide these including but not limited to AHS, Fidelity, and others. As far as you "needing one", that is an opinion based question. It is like most insurance or extended warranties; you are paying a year due to cover yourself. If you never have a problem, you "wasted" the premium; in some instances you may have a problem (new AC unit) that makes the premium make sense. Normally I ask for it for the buyers I work for, as they are usually putting a lot down to obtain the loan and financially can't take any unplanned repairs. After the first year, the home buyer (then the home owner) can determine if the wish to continue coverage on their own dime.

Most people are surprised to find out, a home owner can order one at any time, not "only" when they first purchase the home.

Hope this helps, and best of luck.
Spirit
Web Reference: http://www.ahs.com/
0 votes Thank Flag Link Fri Feb 11, 2011
Not sure the question is understood--are you referring to a purchase or rental--generally home warrantys provide specific types of coverages for such items as appliances, furnaces/heating, central air, doorbells, etc.; they are a service contract that cover repair or replacement, and each plan is different--as for needing one, you decide...
0 votes Thank Flag Link Fri Feb 11, 2011
Home Warranties generally cover the repair costs of home appliances and services, with several add-on options i.e. cac systems.

Whether you need one or not is based solely upon whether you have total responsibility for the care and well-being of all the appliances and services in the home you are leasing. If you do, a home warranty can be very beneficial; I myself have utilized two different companies and in two years and was very glad I did. I have not had coverage in the last two years and luckily, did not need it.
Web Reference: http://gailgladstone.com
0 votes Thank Flag Link Fri Feb 11, 2011
A home warranty is great for a home owner...it covers various appliances and systems (you can add options) that vary from company to company. The question is, as a renter, what is your landlord covering and what are you responsible for.

They generally vary from $400-600/annually. If the oven dies, is it your landlord's responsibility? How about the heating system?

I have used two different companies and utilized services of both that made sense for my home. I am a homeowner.
Web Reference: http://GailGladstone.com
0 votes Thank Flag Link Fri Feb 11, 2011
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