You might have come across numerous online ads for home warranty policies or received several emails touting coverage for home appliances and repair services for worn-out electronic equipment. This might leave you questioning the purpose of such policies, how they operate, or if they're legitimate. However, these insurances are not scams; they are authentic and can be advantageous, potentially saving you a substantial amount of money. Here's a brief guide to help you grasp the concept better.
What does a home warranty
policy entail?
A home warranty is a service agreement that encompasses the cost and services for various home appliances that wear down due to natural aging, such as heaters, freezers, refrigerators, dryers, and washing machines. It helps mitigate expenses for HVAC (heating, ventilation, and air conditioning) and electrical system repairs and replacements. Typically lasting one year, the policy can be renewed annually. These warranty companies often have contracts with a diverse array of service providers, including those specializing in plumbing and electronics.
Difference
between a home warranty policy and home insurance:
Both involve liabilities and claims but provide warranties
for different services. Both warranty and insurance serve the same purpose:
protection. A home warranty policy specifically addresses anticipated appliance
damage, such as wear and eventual system failure. This encompasses the repair
and replacement of electronic devices like refrigerators, heaters, and washers.
Each plan within a home warranty policy is customized to meet specific needs.
On the contrary, homeowners insurance safeguards your belongings against theft, fire, and natural disasters. The insurance company covers the cost of any damage to the house resulting from theft, fire, or natural disasters.
What does the home warranty policy cover?
The cost of a home warranty remains consistent unless the property exceeds 5000 square feet; it is not influenced by age or square footage. Additionally, each company has its own policy regarding coverage for various housing components. For instance, some companies include garage coverage in their policy but require additional charges for guest homes or similar properties. Home warranty fees can be paid in installments or as a lump sum. Coverage costs typically range from $300 to $1000 annually or $20 to $50 monthly. If a technician visits your home, service fees typically range from $60 to $100. Furthermore, home warranties cover service calls, often referred to as labor expenses, which are the fees charged by the service provider to repair appliances or damage.
How does the warranty function?
A home warranty is distinct from home insurance; it's an agreement between the homeowner and the company to repair or replace faulty appliances. Should any of the covered appliances sustain damage, the homeowner can request the company to send a professional to rectify the issue. While the company covers the majority of the bill, it does not cover the service fees agreed upon when purchasing the home warranty plan. For instance, if you bought a new air conditioner with a limited warranty that has since expired and it develops a problem later on, you'd be faced with hefty repair costs, potentially amounting to hundreds or thousands of dollars. However, with a home warranty in place, the damaged equipment's cost would be covered, saving you a significant sum.
Who covers the cost of the home warranty? Buyer or seller?
Either the buyer or the
seller can obtain a home warranty. While purchasing a home warranty isn't
mandatory, it offers significant advantages to the buyer. There are various
reasons why both buyers and sellers might opt for home warranty coverage. The
objectives of a seller's home warranty differ from those of a buyer's home
warranty.
Reasons why a seller might
purchase a home warranty policy
When selling a house, the seller may be concerned about potential breakdowns or replacements. Acquiring a home warranty for appliance protection can alleviate the seller's post-sale worries by sparing them from repair expenses while the property is listed. Additionally, having a home warranty enhances the property's appeal and reassurance to potential buyers.
Reasons why a buyer might purchase a home warranty policy?
A home warranty policy can be obtained through a real estate agent or directly from the home warranty company. If the seller agrees, the buyer might request that the seller covers the cost of the coverage for the initial year. This also allows the buyer to secure a new policy for the property if they prefer not to continue with the seller's existing one. Furthermore, purchasing home warranty coverage provides peace of mind in case of appliance repair or replacement needs, relieving buyers of the financial burden associated with such expenses.
If you are planning to purchase a home warranty plan, look no other than ServicePlus Home Warranty company.
"Unlock Peace of Mind
with ServicePlus Home Warranty: Your Ultimate Protection Plan"
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