Best Home Warranty Companies

A home warranty is a service that helps cover costly repairs on things like plumbing, appliances, and heating and air conditioning systems. Your house is one of the biggest purchases you’ve made and it’s important to keep it protected. Whether that’s normal wear and tear or an unexpected break down of a system or an appliance, a home warranty can cover the repair costs.

With so many home warranty providers out there, it can be hard to know which one is the best for you and your home. At House Method, we’ve done the research, talked to the companies, dug into their service agreements, and reviewed customer feedback.

In this comprehensive guide, we compare the best home warranty companies of 2020 to help homeowners find the right plan at an affordable cost. Keep reading to compare home protection plans, browse home warranty reviews, and choose the right coverage for you and your home.

7 best home warranty companies for 2020

Compare best home warranty companies

CompanyWhy we chose itNumber of covered itemsService feeWaiting periodBBB rating
Choice Home WarrantyEditor's Choice26$8530 daysB-
American Home ShieldBest Customizable Plans27$75–$12530 daysB
Select Home WarrantyMost Cost-Effective Plans24$7530 daysB
First American Home WarrantyBest HVAC Coverage27$75–$10030 daysB+
America's 1st Choice Home ClubBest Workmanship Guarantee24$75–$12530 daysB
The Home Service ClubBest for Immediate Coverage53$75–$9530 daysN/A
2-10 Home Buyer's WarrantyBest for New Construction Homes29$850 daysA

1. Editor’s Choice: Choice Home Warranty

  • 2 plans available + optional add-ons
  • Has over 10 years of industry experience
  • 90-day repair guarantee
  • $36–$44 per month

Why we chose Choice Home Warranty

Choice Home Warranty is one of the best home warranties in the industry, providing comprehensive plans at competitive pricing. Choice offers two plans—a Basic Plan and a Total Plan—both of which include appliances (like a clothes washer and dryer) and systems (such as plumbing and electrical). Customers also have the option to customize add-ons.

Choice Home Warranty does not deny coverage based on the age of your home or covered items as long as you’ve taken good care of them, making the company a great choice for older homes.

2. Best customizable plans: American Home Shield

  • 4 plans + add-ons and the option to build your own plan
  • Customers can choose the service fee they want to pay
  • Provides generous coverage caps
  • $50–$55 per month

Why we chose American Home Shield

American Home Shield founded the home warranty industry and has been in business for almost 50 years, making it one of the most trusted providers we’ve reviewed. We found them to be the best home warranty company for customizable plans.

The company offers four plans: Appliance Plan, Systems Plan, Combo Plan, and a Build Your Own Plan. With these options, customers can select the plan that best fits their home protection needs. AHS also provides extra coverage for items like a pool, spa, or guest house up to 750 square feet.

Additionally, AHS has an extremely efficient claims process. According to the company, it approves and assigns professionals to a customer’s service request within the first 24 hours of the claim 98% of the time—this is faster than any other home warranty provider in the industry.

3. Most cost-effective plans: Select Home Warranty

  • 3 plans + optional add-ons
  • Offers free roof leak coverage
  • Low service fees compared to other home warranty companies
  • $36–$38 per month

Why we chose Select Home Warranty

Select Home Warranty offers coverage for items most companies don’t, including roof leak protection and septic system coverage. It has three plans—Bronze Care, Gold Care, and Platinum Care—that start as low as $36 a month.

Not to mention, this company has some of the lowest monthly premiums and service fees in the home warranty industry. It also runs popular promotions, like including two months free or taking $100 off of your total cost when you sign up for an annual plan. These factors made it easy to name Select the best home warranty for cost-effective plans. 

4. Best HVAC coverage: First American

  • 2 plans + optional add-ons
  • Covers improperly installed or maintained items
  • No cap on coverage for HVAC
  • $28–$43 per month

 

Why we chose First American

First American’s coverage of improperly installed or maintained appliances and systems is a unique perk that most home warranty companies don’t offer. With the company’s First Class Upgrade, your 13-year-old Rheem water heater would be covered even if hasn’t been maintained properly. Note: most companies don’t cover appliances or systems that haven’t had routine maintenance or items that were incorrectly installed or modified.

5. Best workmanship guarantee: America’s 1st Choice Home Club

  • 4 plans + optional add-ons
  • Allows customers to choose their own pre-approved service contractor
  • Has the longest work guarantee in the industry, guaranteeing parts and labor for the life of your membership
  • $38–$50 per month

Why we chose America’s First Choice Home Club

AFC Home Club is one of the top home warranty companies in the industry for comprehensive coverage and personalized service. It offers four plans, which is twice as many as most companies offer. Customers can choose from Systems (systems plan), Silver (appliance plan), Gold (combo plan), or Platinum (comprehensive plan). You can also build your own plan by choosing from a list of optional add-ons.

Of the companies we reviewed, most require customers to wait until the provider connects them with an approved contractor within its network. America’s 1st Choice allows customers to choose their own service provider. That means if you already know a plumber who does an excellent job, you can be reimbursed for hiring them to fix a covered item.

6. Best for immediate coverage: The Home Service Club

  • 2 plans + optional add-ons
  • 10-day waiting period
  • Quick turnaround on claims
  • $46–$61 per month

Why we chose The Home Service Club

The Home Service Club has a short waiting period, a fast claims process, and responsive customer service—all factors that make the home warranty process seamless for the customer and easy for us to name them the best home warranty company for immediate service. HSC offers two plans: Standard and Comprehensive Coverage. The company also offers some unique add-ons that you can pay extra for, such as utility lines, outside power, sewer, water, and irrigation lines.

7. Best for new construction homes: 2-10 Home Buyers Warranty

  • 3 plans + optional add-ons + structural plans
  • User-friendly online customer portal
  • BBB-accredited with an A rating
  • $34–$46 per month

Why we chose 2-10 Home Buyers Warranty

With 39 years of experience and an A rating from the Better Business Bureau, 2-10 Home Buyers Warranty is one of the most trusted companies, offsetting costs for important home systems and appliances and providing affordable structural coverage for new homes.

Homeowners can choose between three plans from 2-10 HBW as well as a list of 10 optional add-ons. The company also offers structural home warranty plans to builders, so of you recently built a home, we suggest 2-10 Home Buyers Warranty to protect your new investment and named it our best home warranty for new construction homes.

Our review process

At House Method, transparency and trust are our most important values for the reader. That’s why we took the time to create an objective rating system and score each home warranty provider according to our methodology. Here’s what the process looked like:

  • We spent hours on the phone speaking to sales agents from market-leading brands to compare quotes, understand protection plan offerings, and evaluate customer service.
  • We surveyed over 1,000 homeowners to determine what coverage is most important to them when it comes to home warranties.
  • We analyzed sample contracts from each of the brands we reviewed. This helped us break down industry jargon, identify red flags, and understand what is and is not covered.

Finally, we created a rating system to determine the best home warranty companies, which involves a weighted, 100-point scale that scores providers on factors like plans offered, coverage, state availability, cost, trustworthiness, customer service, and unique benefits.

How to choose the best home warranty

Home warranties can help save you hundreds of dollars on repairs and replacements of major home systems and appliances. When buying a home warranty, you want to ensure you’re enrolling in a home protection that makes sense for you with a company you trust. Before signing up for a home warranty, take the following factors into consideration.

Type of home warranty plan

Most home warranty providers offer three levels of coverage. Some split their plans by the number of items covered (basic plans, combo plans, and à la carte options) while others divide coverage by the type of item (appliance plans versus system plans).

It’s important to shop around and choose the best plan that covers the most items you have in your home. Compare what common coverage plans offer below.

Basic plans

This includes the major systems and/or appliances that you use every day. The following items are typically covered under a basic plan:

  • Heating, air conditioning, and ductwork
  • Electrical systems, including garage door openers
  • Plumbing system, stoppages, and water heater
  • Clothes washer and dryer
  • Dishwasher
  • Oven/range/cooktop
  • Built-in microwave
  • Refrigerator

This is the best plan for homeowners who want coverage for only the core components to keep their homes up and running.

Combo plans

Upgraded coverage (also called “combination plans”) that includes everything under a basic plan plus additional items. These plans may include coverage for the following:

  • Alarm wiring
  • Built-in food centers
  • Central vacuum
  • Doorbells
  • Smoke detectors
  • Sump pump
  • Trash compactor
  • Water dispenser
  • Whirlpool bathtubs

This is the best home warranty plan for homeowners who want total home protection for all of their appliances and systems.

Optional add-ons

The best home warranty providers have an à la carte menu, allowing you to customize your coverage and build your own plan. Popular add-ons include:

  • Additional appliances, like a second refrigerator or two water heaters
  • Limited roof leak
  • Pool and spa equipment
  • Stand-alone freezer
  • Water softener
  • Well pump

This is the best coverage plan for homeowners who have additional appliances or special features that aren’t standard in all houses.

Appliance plans

Coverage for all major appliances in the home, such as the following:

  • Clothes washer and dryer
  • Oven/range/cooktop
  • Built-in microwave
  • Refrigerator
  • Freestanding ice maker
  • Dishwasher
  • Trash compactor
  • Garbage disposal

This is the best plan for homeowners who are looking for a home appliance warranty, with old home appliances but relatively new systems that are already covered under an extended warranty.

System plans

Home warranty coverage for all major home systems, including the items below:

  • HVAC, including heating, air conditioning, and ductwork
  • Electrical system, including garage door openers
  • Plumbing system, stoppages, and water heater
  • Central vacuum
  • Doorbell
  • Smoke detectors
  • Ceiling, exhaust, and attic fans

This is the best home warranty plan for homeowners with old home systems but recently updated appliances, which are already covered under a manufacturer’s warranty.

Home warranty coverage

Home warranties cover your major home systems and appliances, but there may be limitations and exclusions to what that coverage entails. The following must be true for most providers to approve your claim:

  • The item is explicitly written into your contract and covered under your particular plan.
  • The item has broken due to normal wear and tear.
  • Routine maintenance has been conducted on the item prior to breaking.

Per the requirements above, your home warranty likely will not cover a repair if your garbage disposal isn’t working because it’s jammed with foreign objects, like bottle caps or paper clips. For instance like this, it might be helpful to keep copies of your home inspection or maintenance receipts on hand. An inspection isn’t required to get a home warranty, but it could support your claim if the age or status of your appliances and systems are in question.

Note: Home warranty coverage varies by provider and plan. Make sure you understand the coverage and exclusions outlined in your sample contract before you sign. Additionally, since home warranty coverage and costs vary by state, we encourage you to check out our State Home Warranty Guides and find the best state-specific coverage for your home.

Home warranty coverage caps

Most providers set spending limits on each covered appliance and system. This limited amount often covers repair costs, but not always the total cost of a replacement plus installation.

For example, your plan may set a maximum spending limit of $1,500 on your heating system. Under this warranty, the provider would only cover the repair or replacement cost of an HVAC system up to $1,500. You’d be responsible for the rest of the bill.

On average, providers will pay between $1,500 and $2,000 for HVAC, up to $500 for plumbing and electrical systems, and anywhere from $500 to $3,000 for appliances.

Fortunately, your home warranty still saves you money even if it’s not the full cost of the repair or replacement.

The table below compares average home repair and replacement costs to average home warranty coverage caps. Use it to determine how mudh you could save with home appliance insurance.

Cost to repair Cost to replace Potential savings
HVAC $284–$347 $4,249–$5,413 $544–$1,500
Plumbing & toilets $216–$305 $370–$1,038 $643–$656
Water heater $546 $1,065 $1,037
Refrigerator $310 $1,925 $1,306
Oven/range/stove/cooktop $150 $1,675 $1,607
Dishwasher $150 $1,000 $1,683
Clothes washer & dryer $250–$310 $1,075–$1,250 $1,466–$2,932
Well or sump pump $486–$818 $1,138–$1,543 $625–$925

Note: The above repair and replacement costs are based on national averages. We calculated the average amount that customers can save by compiling sample contracts from the top providers we’ve reviewed.

Home warranty costs

Home warranty premiums cost $25–$67 for each month of coverage. However, you can usually get a better deal if you invest in an annual premium. You might even be able to lock in a price by enrolling in a three- to five-year plan whereas one-year renewals are subject to a price increase year after year.

Home warranty costs depend on where you live and the level of coverage you choose plus any optional add-ons. The price will not vary due to the age or size of the home unless it’s brand new or larger than 5,000 square feet.

Service fees

Your plan will have a set deductible—also known as a service fee—and it will likely have coverage caps, as mentioned above. Most warranty companies charge a non-negotiable, non-refundable service charge of $75–$125 each time a claim is approved.

Read your contract to find out if you’ll be charged a service charge for repeat visits if the problem is not resolved during the first appointment. Some providers, like Choice Home Warranty, will charge customers only once—the service fee or the cost of repair/replacement, whichever is less.

Note: The prices above are based on quotes given to the House Method team, but pricing and promotions always vary by location. Call your home warranty provider to get a personalized quote for free.

35% of customers say that the cost of a plan is the most important factor in their selection process, with the type and amount of items covered coming in a close second at 31%.

Are home warranties worth it?

Coverage plans guard against costly repairs and lend peace of mind, which is why we at House Method think they’re worth it. Here’s what our expert advisors have to say.

A realtor's perspective

When helping my clients decide whether a home warranty would be a good idea or not, we take a look together at the items that would be covered to try and decide if this is something of value.  If there’s a concern that an HVAC system or appliance is nearing the end of life, then it’s likely that the warranty will come in handy.  I have had clients who never used the warranty, but have also had many clients benefit from having this and were thankful it was in place.

Jennifer Vaught, Realtor at Rossi & Taylor Group

Main takeaways for homeowners

  • Read the fine print in your contract so you understand what is covered and what is not.
  • Don’t blame the contractor for a denied claim. They’re just following the instructions of the company.
  • Conduct regular home maintenance, like replacing your air filters. This can save you your copay amount.
  • Read reviews on the company you’re considering. Reviews are a good source for knowing the good, the bad, and the ugly so you know what you’re getting into.

Michael Stimpson, Owner of Snowflake Air

An attorney's opinion

Generally speaking, I’d argue that they are 100% necessary. Your house, after all, is likely the largest purchases you’ll ever make. It’s extremely important that you take whatever measures necessary to protect that investment.

Ryan B. Bormaster, Managing Attorney at Bormaster Law

Mr. Handyman's advice

Understand what your plan includes, and what it does not.  Consistent maintenance and repair of your home are important. Keeping gutters clean, windows and doors caulked, fixing minor damage before it becomes major damage, etc.  Does the warranty you are considering cover this kind of work, or only fixing things after the damage has occurred? Are there depreciation schedules, exclusions, or things (lack of maintenance) that void the warranty?  Don’t just assume what’s covered—know what’s covered.

Mike McCalley, Owner of Mr. Handyman

Why home warranties are important

A home warranty makes sense for just about everyone. Not only do they protect you in the event of an unexpected system or appliance breakdown, they save you hundreds of dollars on repair and replacement costs and provide peace of mind.

To better understand what draws homeowners to purchase home warranties, we surveyed more than 1,000 policy holders about when and why they chose to buy their plans. Here’s what we found.

Homeowners on a budget—Our survey revealed that 59% of homeowners who have a home warranty purchased a service contract because they were unsure they would be able to afford the cost of repairs without it.

What’s more: In 2018, 40% of American adults reported they don’t have enough savings to cover a $400 emergency bill. To most of us, $30 a month for a home protection plan sounds much more manageable than a $1,000 dishwasher replacement.

First-time homeowners—Our research shows that 66% of customers purchased their contracts at the time of their home sale. Since buying a home is overwhelming and expensive, this makes a lot of sense. On closing day, you’ll likely have a tight budget and a long list of home improvement projects to do.

First-time homeowners can buy themselves some peace of mind and save thousands of dollars by putting $30 a month toward a basic coverage plan. You can always cancel once you’ve settled in.

Owners of older homes—Things break over time. Your house gets that lovely lived-in look, but your appliances will eventually cave to years of wear and tear.

Owners of mobile homes—Home warranties also apply to mobile or manufactured homes. No matter how small your home’s footprint is, you can still protect your investment with a mobile home warranty.

Novice do-it-yourselfers—Some homeowners attempt to fix items themselves because they can’t afford to hire a professional. Repairs by an unskilled party can be dangerous to the person conducting them and can cause even greater harm to the system or appliance. Customers have access to a network of local professionals who can get the job done quickly and efficiently.

Home sellers—You’ve finally gotten your house in tip-top shape. You’ve boosted curb appeal, given each room a fresh coat of paint, and remodeled the kitchen. You’re ready to list it and then the HVAC goes out.

A home warranty will cover these repairs while your house is on the market, so you can keep it up and running for potential buyers. It’s also a great marketing tool since sellers can transfer the warranty to the buyers. One-year plans offer buyers coverage for their first year in their new house.

Real estate agents—You can buy a home warranty any time after closing, but many homeowners buy coverage during a home sale. As mentioned above, a plan can be an incentive to people who are buying a home and are feeling wary about potential repairs.

As a listing agent, it might also ease your mind knowing that the sellers who you’re representing can fix issues that come up while the house is for sale.

Rental property owners—Coverage is also convenient for rental property owners who lease houses to tenants, like college students. You can even bake the price of a plan into your tenants’ overall rental fees.

If you rent multiple properties, you can expedite maintenance by submitting claims through an 800 number that’s often available 24/7. The warranty provider will send out a licensed contractor for you, saving your small maintenance team time and money.

On the flipside, you might not need a one if:

  • You have 1% of the home purchase price saved for home repairs (i.e. a $300,000 home would need a $3,000 repair budget)
  • Your newly built home is already covered by a builder’s warranty
  • Your appliances and systems are protected under a manufacturer’s warranty

Home Warranty FAQ

What is a home warranty?

A home warranty—also known as home appliance insurance or home repair insurance—is a service agreement that helps protect your major systems and appliances and saves you money on unexpected repairs and replacements.

Most plans last for 12 months. At the end of the contract term, customers can renew their plan.

How does a home warranty work?

If one of your covered household items breaks unexpectedly, file a claim with your home warranty company either online or over the phone. Note: Most companies require customers to submit a claim within three days of the system or appliance breaking. The best home warranties are open 24/7/365 and approve claims within 24 to 48 hours, but other companies will make customers wait up to four days on weekends and holidays.

Once your claim is approved by the home warranty company, they’ll either send one of their approved technicians to your house to diagnose the issue or allow you to choose your own contractor for repairs. The contractor will recommend a repair or replacement for your broken system or appliance.

During this service visit, you’ll pay the contractor a service fee of $75–$100 and the warranty company will cover the rest of the repair or replacement costs.

What's the cancellation policy for home warranties?

You can usually cancel at any time and receive a refund of the amount you don’t use. Ask the company about cancellation policies and fees. We’ve seen fees range from $50 to $100.

What's the difference between a home warranty and homeowner's insurance?

Homeowners insurance, also known as home insurance, is required by most mortgage lenders and has premiums that are usually bundled with your monthly mortgage payment. While home insurance covers structural damage as a result of a fire, natural disaster, or other situations outside your control, a home warranty covers core appliances and systems within your home when they malfunction due to age or normal wear and tear.

You could go a lifetime without making a homeowners insurance claim whereas the average homeowner files two home warranty claims per year.

Do I need to get a home warranty if I already have a manufacturer's warranty?

Manufacturer’s warranties cover individual appliances or systems and are issued by the manufacturer of that particular product. Three common complaints of manufacturer’s warranties are that there’s coverage for only one item, the coverage is non-transferable, and they typically cost more money in the long run.

Registering for a manufacturer’s warranty for each item separately adds up fast and coverage usually only lasts one to two years, whereas a home warranty plan will cover all of your appliances and systems under one renewable plan.

Our conclusion

Our team at House Method stands by our ratings and reviews of the home warranty companies listed in this article and would recommend all of them to those who are looking to buy one. However, if you’re still on the fence about which home warranty company to go with, we encourage you to read the individual provider reviews to get a more in-depth look at the coverage, costs, and unique benefits of each business and find the best home warranty for you.

If you’re looking for something in particular, like fast coverage or protection for specific appliances, compare the best home warranty plans below.

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