When it comes to protecting your home, understanding the differences between a home warranty and home insurance is crucial. While both offer valuable coverage, they serve distinct purposes.
Typical Coverage
A home warranty is a service contract that covers repairing or replacing major home systems and appliances due to normal wear and tear. This type of coverage can provide homeowners with peace of mind, knowing that unexpected breakdowns won’t lead to significant out-of-pocket expenses.
A home warranty may help cover the following:
- Major appliances—Home warranties often cover crucial household appliances such as refrigerators, ovens, dishwashers, washers and dryers. These items are essential for daily life, and repairing or replacing them can be expensive.
- Home systems—Key systems within the home, including heating, ventilation and air conditioning (HVAC), electrical and plumbing systems, are usually covered. This can help ensure that the home’s core functionalities are maintained.
- Additional items—Some plans may include coverage for items like water heaters, garbage disposals and built-in microwaves.
- Exclusions—It’s important to note that home warranties typically do not cover damage due to severe weather events, lack of maintenance or preexisting issues. Additionally, structural components of the home, such as walls and roofs, are generally not included.
Home Warranty vs. Home Insurance
While both home warranties and home insurance offer financial protection for homeowners, they serve distinct purposes and cover different aspects of the home. Home insurance can provide financial protection against damage or loss from specific perils and is often required by mortgage lenders as a loan condition. In contrast, a home warranty can help pay for repairing or replacing home systems and appliances that break down from regular use. Unlike home insurance, a home warranty is typically optional and can be purchased at any time.
Learn More
Contact Simple Lane Insurance Agency to discuss your insurance options.
This blog is intended for informational and educational use only. It is not exhaustive and should not be construed as legal advice. Please contact your insurance professional for further information.