Best Home Warranty

By: Kelsey Roadruck, Reviews Editor at House Method | Affiliate Disclosure

A home warranty—also known as home appliance insurance or home repair insurance—is a service agreement that you can purchase through a home warranty provider of your choice.

The best home warranty has clear contracts, several plan options, and full coverage. We reviewed the best home warranty companies to help homeowners find out if a home warranty is worth it and how to get a plan for the best value. With our comprehensive guide, you can compare home protection plans, and we’ll explain to you how to choose the best warranty for you and your home.

The 9 best home warranty companies

  1. Choice Home Warranty: Best Overall
  2. American Home Shield: Best for Appliance Coverage
  3. Select Home Warranty: Best Value
  4. First American Home Warranty: Best for Limited Exclusions
  5. America’s 1st Choice Home Club: Best for Customizable Plans
  6. The Home Service Club: Best for Fast Coverage
  7. Pride Home Warranty: Lowest Service Fees
  8. 2-10 Home Buyers Warranty: Most Trusted
  9. Total Home Protection: Best for Septic Systems
1,000

Customers Surveyed

7

Experts Consulted

335

Sales Calls Evaluated

32

Companies Considered

19

Contracts Analyzed

9

Finalists

Best overall: Choice Home Warranty

Best Overall
  • 2 plans available + optional add-ons
  • After hours customer service
  • 90-day repair guarantee
  • $29–$42 per month

Awesome service and very timely with repairs.

Fabian H.
HM Score
Availability

All states except CA and WA

Service Fee

$75

Why we chose Choice Home Warranty

Choice Home Warranty offers the best home warranty coverage (even with its most basic plan) at competitive pricing.

Comprehensive coverage
Choice Home Warranty 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. You can get home warranty coverage for your well pump or a second refrigerator. Note: freon is fully covered by Choice Home Warranty. Most companies charge $10 per pound.

Few exclusions
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 it a good choice for older homes.

Affordable cost
Monthly plans start at $29 with a service fee of $60–$75. The waiting period is 30 days between sign up and when coverage begins.

Choice Home Warranty reviews

The Better Business Bureau (BBB) gives Choice Home Warranty a B- rating based on 1,400 customer reviews. Here’s one Choice Home Warranty review featured on its website from Jaya M. on December 18, 2018:

Our claim to repair our clothes dryer was processed quickly and an experienced brand certified technician was sent to diagnose the problem. The technician knew right away what the problem was. He came back the following day with the part and fixed the dryer. Very good service! We are completely satisfied with this claim and the time it took to repair.

Best appliance coverage: American Home Shield

Appliance Coverage
  • 4 plans + optional add-ons 
  • Option to build your own plan
  • BBB accredited
  • Generous coverage caps
  • $20–$65 per month

They also follow up to make sure that the work was properly done.

Mark S.
HM Score
Availability

All states except AK and 5 boroughs of NYC

Service Fee

$75–$125

Why we chose American Home Shield

American Home Shield covers the cost to repair, replace, remove, and dispose of appliances that break from normal wear and tear.

Extensive coverage
American Home Shield offers four plans: Appliance Plan, Systems Plan, Combo Plan, and a Build Your Own Plan. Customers also have the option to add on extra coverage for items like a pool, spa, or guest house up to 750 square feet.

Longest home warranty company in the business
American Home Shield founded the home warranty industry 48 years ago. If you’re looking for one of the best home warranty companies with some real experience, American Home Shield is a good choice.

American Home Shield cost
Costs vary by location but the quotes House Method received were between $20 and $65 per month. Service fees range between $75 and $125, which is higher than average. Coverage begins after 30 days of signing up and lasts 12 months.

Note: The cost to remove and dispose of broken appliances is covered by American Home Shield whereas most companies will charge customers an extra removal fee.

American Home Shield reviews
The BBB gives American Home Shield a B rating based on 2,929 customer reviews. This rating recently improved after the company responded to negative reviews. Here’s what Lauren V. D. said about AHS on December 17, 2018:

Our American Home Shield techs are always patient, thorough, and take the time to explain our heating system to us so that we understand the issues and know how to correct them if [and] when they occur again. They are always timely, courteous, and professional!

Best value: Select Home Warranty

Best Value
  • 3 plans + optional add-ons
  • Free roof leak coverage
  • Optional septic system coverage
  • Responsive customer service
  • $36–$42 per month

The best service I've ever had.

Erica M.
HM Score
Availability

All states except NV, NY, WA, and WI

Service Fee

$75

Why we chose Select Home Warranty

Select Home Warranty offers coverage for items most home warranty companies don’t, including roof leak protection.

Unique add-ons

Select Home Warranty offers three plans with unique add-ons. Bronze Care covers appliances, Gold Care covers systems, and Platinum Care covers both appliances and systems. You’ll also have the option to add protection for items that most home warranty companies don’t cover. Unique add-ons include roof leak protection and septic system coverage.

Home warranty promotions
Select Home Warranty costs $36 to $42 per month with a service fee of $75. Your 12-month contract begins 30 days after registering. Popular promotions include two months free and $100 off when you sign up for an annual plan.

Select Home Warranty reviews
The BBB has given Select Home Warranty a B rating. This is largely due to the home warranty company answering 2,261 customer complaints in the past three years, proving its responsiveness.

Customer reviews tout Select’s network of knowledgeable sales reps and reliable service contractors. Here’s one Select Home Warranty review from the BBB’s website on May 21, 2016:

Strong customer advocate in a stressful situation with a bad water heater. Jermel (claims manager) was highly attentive with a very strong service mindset. I could not have asked for a more knowledgeable advisor to solve the problem.

Best for limited exclusions: First American

Limited Exclusions
  • 2 plans + optional add-ons 
  • Covers improperly installed or maintained items
  • No cap on coverage for HVAC
  • Recommended by and for real estate agents
  • $28–$50 per month

 

I would give it a 10.

Rodney M.
HM Score
Availability

Not available in AK, CT, DE, HI, IL, LA, MA, ME, MN, ND, NH, NY, RI, VT, or WI

Service Fee

$75

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.

Coverage with limited exclusions
First American offers one plan for home sellers and two plans for home buyers or homeowners in addition to optional add-ons.

If you go with First American, we highly recommend enrolling in its First Class Upgrade. Most companies don’t cover appliances or systems that haven’t had routine maintenance or items that were incorrectly installed or modified.

First American’s First Class Upgrade is an exception to the rule. That means your 13-year-old water heater is still covered even if it’s showing signs of rust (which it probably is even if it has been well-maintained).

Option to renew
Monthly plans range between $28 and $50 with a $75 service fee. Contracts last 12 months but you will have the option to renew year after year.

First American Home Warranty reviews
The BBB gives First American a B+ rating based on 3,154 customer reviews. Here’s what Lisa M. had to say about First American:

If something happened and we weren’t covered with First American, I can’t even imagine how expensive it would be. Because things do go wrong when you own a home. You could have one problem one day then, two weeks later it’s something else. So, no matter how many times it happens, you know you’re covered.

Best customizable plans: America’s 1st Choice Home Club

Customizable Plans
  • 4 plans + optional add-ons
  • Choose your own pre-approved service contractor
  • No cap on HVAC coverage
  • $32+ per month

The peace of mind is worth having this warranty to me!

Cindy F.
HM Score
Availability

All states except CA, HI, and SC

Service Fee

$75–$125

Why we chose America’s 1st Choice Home Club

AFC Home Club lets customers choose their own contractors to repair and replace covered items.

AFC Home Club custom coverage
The best home warranty plans are ones you can customize. Fortunately, America’s 1st Choice Home Club offers four home warranty plans, which is twice as many as most home warranty 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.

Option to choose your own service provider
All of the home warranty companies that we’ve reviewed 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 ownservice 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.

AFC Home Club cost
America’s 1st Choice Home Club plans begin at $32 per month with a service fee of $75–$125. These are 12-month plans that can be paid monthly or annually.

AFC Home Club reviews
America’s 1st Choice is BBB accredited with a B rating. Customers have praised the company’s reliability to fulfilling what has been promised. Here’s a customer review from Mary M. that we found on Google in December 2018:

America’s 1st Choice Home Club offers a variety of home warranties. I was able to order appropriate warranties for two real estate transactions at affordable prices for my clients. Great communication and follow up from their associates.

Other home warranty companies to consider

Quickest coverage: The Home Service Club

Fast Coverage
  • 2 plans + optional add-ons 
  • 10-day waiting period
  • Quick turnaround on claims
  • Best customer reviews
  • $33+ per month

They gave me a call right away to set up an appointment for later that day.

Nicole G.
HM Score
Availability

Nationwide

Service Fee

$65–$125

Why we chose The Home Service Club

The Home Service Club has a short waiting period, a fast claims process, and responsive customer service.

Utilities included in coverage
The Home Service Club offers two plans—Standard or Comprehensive Coverage. The company also offers some unique add-ons that you can pay extra for. Most home warranty companies don’t cover utility lines, but The Home Service Club will cover outside power, sewer, water, and irrigation lines.

Lower premiums
Plans start at $33 per month. Customers can opt into a lower premium for a higher service fee of $65–$125. Contracts last 12 months but you could get up to five additional months for free if you enroll in a five-year plan.

Remember: You have the option to cancel your policy at any time. You’ll be refunded the prorated amount you’ve already paid for but haven’t used.

The Home Service Club reviews
The Home Service Club is not BBB-accredited, but the Business Bureau gives it a C.

On the other hand, and perhaps more importantly, The Home Service Club has the highest customer ratings of all of the home warranty companies we reviewed. Customers praise the company’s quick turnaround on claims and efficient technicians. Here’s what Vonda J. reported on Google in January 2019:

I signed up with Home Service Warranty a few years ago. I have used them several times. The service is great. The repair people are fair and knowledgeable. The low deductibles are worth not having to pay in full for the repairs or replacements. I always highly recommend this company to all of my clients and friends. It’s money well spent.

Lowest service fee: Pride Home Warranty

Lowest service fee
  • 3 plans + optional add-ons
  • Low service fee
  • Generous pay-outs
  • Responsive customer service
  • $25–$32 per month

The few times I’ve had to make a claim, it’s possibly the easiest process I’ve ever been through.

Bruce
HM Score
Availability

All states except CA, NJ, HI, and KS

Service Fee

$45

Why we chose Pride Home Warranty

With coverage caps up to $3,000 and a low service fee, Pride Home Warranty offers great home warranty insurance at an affordable price.

Multiple plans with optional add-ons
Pride Home Warranty offers three plans—Major Systems Plan, Premium Platinum, and Platinum Plus—along with optional add-ons for items like a second refrigerator.

Competitive pricing
Pride Home Warranty’s plans are competitively priced, starting at $25 per month. Its $45 service fee is the lowest we’ve seen at $30 less than the industry standard.

Pride Home Warranty reviews
The Better Business Bureau currently gives Pride a C+ rating, but customers give it four stars on the BBB’s website. Here’s what Mary from South Dakota had to say:

I’m very happy with Pride home warranty! My water heater went out in the dead of winter. I called and the tech came out and said it was not repairable—it would have to be replaced. He came by and installed the new one the next day and now I have hot water again. All for one service fee! [I’m] very happy and [I] would recommend them to everyone I know.

Most trusted: 2-10 Home Buyers Warranty

Most trusted
  • 2 plans + optional add-ons + structural home warranty plans
  • No waiting period
  • User-friendly online customer portal
  • BBB-accredited
  • $33–$47 per month

I'm renewing my plan because of their excellent customer service.

Rex and Susan P.
HM Score
Availability

Nationwide

Service Fee

$75–$100

Why we chose 2-10 Home Buyers Warranty

With 38 years of experience and an A-rating from the Better Business Bureau, 2-10 Home Buyers Warranty is perhaps the most trustworthy home warranty company.

Coverage for home builders
Homeowners have the choice between two home warranty plans from 2-10 as well as a list of 10 optional add-ons. 2-10 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.

Lower service fees
2-10 costs start at $33 per month with a service fee of $100. However, customers can pay an extra fee upfront to lock in a lower service fee of $75.

2-10 Home Buyers Warranty reviews
2-10 Home Buyers Warranty has aced the Business Bureau’s test. It has maintained an A-rating for quite some time now.

Here’s what James B. reported on the BBB:

I usually don’t review things online, but [I] wanted to add that my experience with 2-10 has been great. They have been very accommodating and attentive. They have exceeded my expectations.

Best coverage for septic systems: Total Home Protection

Septic Systems
  • 2 plans + optional add-ons 
  • 90-day parts guarantee
  • Add-ons available
  • After-hours service
  • $33+ per month

Two thumbs way up!

Brandy
HM Score
Availability

All states except CA, IA, NV, NY, WA

Service Fee

$75

Why we chose Total Home Protection

Total Home Protection is a new home warranty company that’s ideal for homes with septic systems.

Septic system coverage
Total Home Protection keeps it simple. Customers can choose from two home warranty plans—Gold or Platinum—and get coverage for appliances and systems. Total Home Protection’s list of optional add-ons gives homeowners the opportunity to protect additional items, like a second garage door opener for your two-car garage.

We’ve also deemed Total Home Protection the best home warranty for septic systems because homeowners can add on optional coverage for their septic system, including septic tank pumping. The coverage cap on septic system diagnosis and repairs is $500 per contract term.

Total Home Protection cost
We received quotes from Total Home Protection that ranged from $43 to $52 per month. The company charges a standard $75 service fee per claim.

Total Home Protection reviews
Here’s a five-star review from Joe M., which was originally published on the BBB’s website:

[I] have a contract with Total Home Protection. I am also a contractor in Ohio with an A+ rating for over 10 years. My experience with Total Home Protection, and their local service provider was very favorable. There were ordering and timing issues, [but] not the fault of the service provider. Considering the cost savings, shipping delays due to availability of parts, and service contact, I consider their service work, and staff to be first rate.

Best home warranties by state

Home warranty costs and coverage depend on the location of the customer’s home. The following are the top-searched locations for home warranties. We’ve created a cheat sheet for homeowners in those states.

Best home warranty in Alabama: Select Home Warranty offers free coverage for roof leaks, which can be handy in a state that sees hurricanes, tornadoes, and severe storms.

Best home warranty in Arizona: American Home Shield will not only cover your systems and appliances, but Arizona homeowners can also buy home warranty coverage for their pool, spa, and guest units.

Best home warranty in California: The Home Service Club is one of the only top home warranty companies that offer coverage in California.

Best home warranty in Florida: Choice Home Warranty’s list of optional add-ons is intriguing for Floridians. It includes coverage for a pool, spa, septic system, well or sump pump, second refrigerator, and stand-alone freezer.

Best home warranty in Georgia: Headquartered in Marietta, Georgia, America’s 1st Choice Home Club will keep homes cool in the next heat wave. It offers comprehensive HVAC protection with no cap on coverage.

Best home warranty in Maryland: The Home Service Club won’t make you wait for home warranty coverage. Maryland home warranty plans activate 10 days after purchase and include additional coverage for roofs and utility lines, which can be convenient before the big chill sets in again.

Best home warranty in Michigan: Michigan homeowners can get the best home warranty coverage for the best price with Choice Home Warranty.

Best home warranty in Nevada: Landlords and property managers can get a discount when they purchase home warranties for multiple properties through American Home Shield.

Best home warranty in Pennsylvania: Customer service is especially important when a major system or appliance calls it quits. Select Home Warranty is a great choice for folks in Pennsylvania who value responsive customer service.

Best home warranty in Ohio: Ohio landowners can get a home warranty and pest control from The Home Service Club.

Best home warranty in Texas: Texans can hire their own trusted contractor to complete home repairs through America’s First Choice.

Best home warranty in Utah: Life is elevated with Choice Home Warranty. Utah homeowners will appreciate the peace of mind that a home warranty provides.

Best home warranty in Virginia: First American is a great choice for older homes, as it covers systems and appliances that have been improperly installed, modified, or maintained.

Buyer’s guide

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 home warranty 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 home warranty 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 fee of $75–$125 each time a claim is approved.

Read your contract to find out if you’ll be charged a service fee 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 to get your personalized quote for free.

35% of customers say that the cost of a home warranty 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%.

Home warranty coverage

Home warranties cover major home systems and appliances. The following must be true for most home warranty 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 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.

Home warranty coverage varies by provider and plan. Make sure you understand the coverage and exclusions outlined in your sample contract before you sign.

It might be helpful to keep copies of your home inspection or maintenance receipts on hand. A home inspection is not 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.

Home warranty coverage caps

Most home warranty providers set spending limits on each covered appliance and system.

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.

Fortunately, your home warranty still saves you money—sometimes thousands of dollars—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 whether you need additional 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 home warranty customers can save by compiling sample contracts from the top home warranty providers we’ve reviewed.

Types of home warranty plans

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 home warranty plan that covers the most items you have in your home. Compare what common home warranty plans offer below.

Basic home warranty 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 home warranty 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 home warranty plan for homeowners who have additional appliances or special features that aren’t standard in all houses.

Appliance plans

Home warranty 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 home warranty plan for homeowners 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.

13 questions to ask before buying a home warranty

To ensure you’re getting the right plan for the best price, call a home warranty company prior to purchase. It’s much easier to negotiate a deal over the phone than email.

Whether you’re waiting for a call or you’ve got the phone in your hands now, here are some questions you should ask a sales representative along with the answers you should expect to hear.

What does a home warranty cover?

Home warranties cover major home systems and appliances. The majority of home warranty complaints are due to a customer’s misunderstanding of their coverage, which is frustrating for all parties involved. Deciphering and comprehending service agreements is tricky. Consider excessive jargon and countless exclusions as red flags and look elsewhere.

Does the age or brand of the home or its systems and appliances matter?

The answer should be no.

Does a home warranty cover systems or appliances or both?

Your home warranty will typically cover the repair or replacement costs of specific appliances (refrigerator, dishwasher, clothes dryer, etc.) or systems (plumbing, electrical systems, etc.) in a house for a preset period of time, usually 12 months.

Reflect on the items that you’d like to protect and choose a plan that covers the majority of your list. If the home warranty website or sample contract is unclear, ask the sales rep if your top priority items are covered. If they aren’t, ask if you can add them on to your plan for an extra fee.

What's not covered under a home warranty?

Don’t forget to read the fine print beneath covered systems and appliances. We’ve found several situations in which there’s a plan that covers a refrigerator, but not an ice maker. Others will cover your exhaust fan, but won’t cut into the ceiling to replace it.

How much do home warranties cost?

Home warranties cost $25–$67 per month, but we recommend narrowing your search to providers with premiums that cost $50 or less.

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 $75.

How does the claims process work for a home warranty?

Household items break unexpectedly and often at the worst times. If a customer service line is not available 24/7, ask whether you can submit a claim online.

Also, follow up about the average turnaround time for claims. The best home warranties approve claims within 24 to 48 hours, but other companies will make customers wait up to four days on weekends and holidays.

What are the service fees for a home warranty?

Service fees are usually $75–$125. These are non-negotiable and non-refundable and every home warranty provider charges one.

Another perk you can inquire about is whether the provider will charge the lesser amount between the service fee and the actual cost of the repair or replacement.

Will I be charged for repeat visits if a problem persists?

The answer should be no.

You should also follow up with the scenario in which you’re unhappy with the services provided by the contractor. Ask if they can send a different technician on the next visit or whether you can get a second opinion.

Will a broken item be repaired or replaced under a home warranty?

Customers with old appliances and systems should ask whether the company will replace covered items that are beyond repair. The majority of service agreements state that the home warranty company is responsible for repairing or replacing a covered item back to working order that’s up to code. However, the company is not responsible for matching the brand, model, or color of the item they’re replacing.

Are there limits as to how much a home warranty plan will pay out?

If the provider will replace a covered item that’s beyond repair, ask if they’ll cover the total cost of the item. Most home warranty companies limit how much they’ll pay out. This limited amount often covers repair costs, but not always the total cost of a replacement plus installation.

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.

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.

Bottom line—you’ll save more money with a home warranty. 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.

Do I need a home warranty if I already have 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.

Bottom line—you’ll get more use out of a home warranty. You could go a lifetime without making a homeowners insurance claim whereas the average homeowner files two home warranty claims per year.

Call the best home warranties today

Are home warranties worth it?

Home warranties 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 home warranty 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 home warranty company.
  • Conduct regular home maintenance, like replacing your air filters. This can save you your copay amount.
  • Read reviews on the home warranty 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 home warranties 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 home warranty 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

Who needs a home warranty?

A home warranty makes sense for just about everyone. To better understand what draws homeowners to purchase home warranties, we surveyed more than 1,000 home warranty 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 home warranty 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. A home warranty is a great birthday present to a 10-year-old house and its original appliances.

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. Home warranty 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—boom. You’re 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 home warranty 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 home warranty 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—Home warranty 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 home warranty 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

How does a home warranty work?

Managing and using your home warranty is a simple and straightforward process. In sum, if a major system or appliance breaks or stops working, you would call your home warranty company, who would then call a provider to come out and make a repair or replacement.

Here are a few more specifics of how a home warranty works.

How long do home warranties last?

Most home warranty plans last for 12 months. At the end of the contract term, customers can renew their plan and the majority of customers do.

In fact, 65% of home warranty sales are through renewals, according to Colonnade. American Home Shield alone boasts a 75% renewal rate.

Home warranties aren’t insurance policies, though. You can almost always cancel at any time. If you paid in full at the time of signing, the provider should refund you the prorated amount of the warranty you haven’t used yet.

How to submit a claim

When a covered item breaks from age or normal wear and tear, the provider will repair or replace the item. Most home warranty companies require customers to submit a claim within three days of the system or appliance breaking. Try to evaluate the situation before requesting service. If the item didn’t fail or malfunction due to age or normal wear and tear, it’s likely not covered and you’ll end up paying a $75 service fee for nothing.

You can submit a claim online or by calling an 800 number. Once you do this, the home warranty company will find and dispatch a local home repair professional—usually a licensed contractor within the provider’s network—to evaluate and resolve the issue.

Note: It can take 48 hours to four days for providers to approve your claim and schedule service. Home warranty providers also reserve the right to send a contractor within their own network. If this is the case, you should not hire your own contractor and expect to be reimbursed by the provider. 

Should you need to cancel your appointment, remember that most providers will charge you a service fee as soon as the technician is en route.

Most common home warranty claims

Data from the Real Estate Inspection Company

Mechanical failures make up 79 percent of all home warranty claims.

Plumbing problems make up the majority of home warranty claims. Plumbing systems, stoppages, and toilet repairs are covered by most plans.

Home warranty customers can save up to $1,500 on HVAC repairs.

Routine maintenance, like flushing sediment from water heaters, is required by most home warranty companies in order to cover water heater repairs.

Washers, dryers, dishwashers, ovens, cooktops, built-in microwaves, and refrigerators are covered by basic home warranty plans.

Electrical repairs include wiring, garage door openers, and doorbells.

Garbage disposals that have worn out from normal wear and tear are covered by home warranties.

Only one percent of home warranty claims are related to gas problems.

Our conclusion

So, what is the best home warranty?

We think Choice Home Warranty is the best home warranty company overall. It has two plan options plus optional coverage for additional items, competitive pricing with regular promotions, and a 90-day repair guarantee.

If you’re looking for something in particular though, like fast coverage or protection for specific appliances, then compare home warranties below.

CompanyBest home warranty forNumber of
covered items
Service feeWaiting periodBBB rating
Choice Home WarrantyBest Home Warranty26$7530 daysB
American Home ShieldAppliance Coverage27$75–$12530 daysB
Select Home WarrantyBest Value24$7530 daysB
First American Home WarrantyLimited Exclusions27$7530 daysB+
America's 1st Choice Home ClubCustomization24$75–$12530 daysB
The Home Service ClubFast Coverage53$65–$12530 daysC
Pride Home WarrantyLowest Service Fees25$4510 daysC+
2-10 Home Buyer's WarrantyMost Trusted29$1000 daysA
Total Home ProtectionSeptic Systems37$7530 daysF

Who didn’t make the cut?

There are nearly 200 home warranty companies in business today. After reviewing dozens of the most popular home warranties, we’ve narrowed the selection down to the 9 best home warranties. Here are a few home warranty companies that didn’t make the cut and why:

  • North American Home Warranty actually used to be the cheapest home warranty until it went out of business.
  • Sears Warranty has also struggled with changing business models and e-commerce. It filed bankruptcy in October 2018, so the future of its warranty is still unclear. However, the company has said that it expects no change to currently scheduled service appointments and coverage.
  • Costco home warranty is a non-traditional home protection plan that doesn’t add up to a real home warranty. It only protects select electronics and individual appliances.

Here’s what the worst home warranty companies have in common:

  • Poor customer reviews.
  • Alerts or a significant amount of unresolved complaints on the Better Business Bureau.
  • Inconsistent ratings across other review sites.
  • Excessive jargon in sample contracts.

Our review process

House Method has a strict rating rubric whenever we advise our readers on the products and services that are worth their money. In our home warranty review process, we surveyed over 1,000 home warranty customers to find out why they purchased a home protection plan.

Then, our team spent hours on the phone with sales agents from market-leading home warranty brands to compare quotes and evaluate customer service.

Finally, 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.

Our criteria for the best home warranty takes a variety of factors into consideration. Below is the checklist we use to review home warranties:

  • A sample contract is accessible online
  • Exclusions and limits are clearly defined
  • Generous coverage caps above $500
  • Multiple plan options
  • Premiums are below $600 per year
  • Low service fees below $100
  • Responsive customer service that’s available after hours
  • Easy claims process
  • Quick turnaround time on approving claims and dispatching contractors
  • Positive reputation backed by customer reviews
  • A Better Business Bureau rating above a C
  • National availability

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