While a home insurance plan provides senior homeowners with insurance that covers unforeseen events that lead to extensive home damage – such as a fire, flood, or storm – home warranty coverage addresses those items within your home you expect to break or stop working. One provides insurance against unplanned events while the other provides a warranty on the things you own within your home.

So, what does a home warranty plan typically cover, what does it not cover, what are the monthly costs of the plan and what items within your home are you better off replacing or repairing as needed?

What Does a Home Warranty Cover?

Home warranties cover the replacement and repair costs of the appliances, electronics, plumbing, and HVAC (Heating Ventilation, and Air Conditioning) systems throughout your home. A home warranty covers your kitchen’s refrigerator, stove, dishwasher, and microwave while covering the plumbing within your kitchen, bathroom, and throughout your home.

A home warranty may also cover your washer and dryer, the ceiling fans throughout your home, doorbells, alarm systems, central vacuums, and garage door opener.

Think of a home warranty as an extra warranty on electrical accessories and appliances throughout your home. While you may buy a warranty for your recently purchased refrigerator, a home warranty would help eliminate any gaps in warranty coverage for that refrigerator or any other appliance within your home.

Home warranties do not cover any damage to your home’s foundation, walls, roof, windows, flooring, or structure. It does not cover any issues or damage resulting from a storm, fire, or act of God. It only covers specific appliances, plumbing, HVAC, and electronic equipment within your home.

What Are the Typical Costs of a Home Warranty?

While the annual average cost of a home warranty within the USA is $1049, prices can vary substantially based on what appliances, systems, and electronics you want warrantied and the type of warranty you choose. In some cases, a home warranty can be as low as $100 to $200 a year or as high as $8,000 or more – depending upon the number of appliances within your home and their value.

How is a Home Warranty Claim Made?

This raises the question of whether it makes sense for today’s seniors to have a home warranty or have repairs done as needed. To answer this question, it’s important to understand how a claim is made on a home warranty.

Once an appliance is damaged and a home warranty claim is made, the company dispatches a technician to your home to assess the damage. Herein lies the issue with the home warranty. First, many home warranty providers charge a service call/technician dispatch fee. This means you must cover out-of-pocket expenses to have the appliance inspected.

Once the appliance has been inspected, the technician determines whether the damage is repairable under the warranty, or if the damage was caused by neglect, poor maintenance, or a pre-existing condition of the appliance.

Unless you’re technically inclined and have experience with appliances and how they work, you’re ultimately left to the technician. The technician alone decides whether the cost of replacement or repair is covered by the home warranty.

Ultimately, if the cost of the service call is too high – and your item isn’t covered by the warranty – then you may be paying multiple fees for each claim.

Foregoing a Home Warranty for Repairing as Needed

If you are a senior unsure whether to get a home warranty or pay for repairs as needed, the following tips will help make that decision easier.

• The Age of Your HVAC, Plumbing, Appliance, and Electronics If you’ve recently purchased a newly constructed home (within 1 to 5) with a new HVAC system and plumbing – and have all new home appliances – then a home warranty isn't needed. However, if your home is older, has an HVAC system that has been in service for 10 years or more, and has older appliances past their warranties, then a home warranty is likely to be a good choice.
• Your Do-it-Yourself (DIY) Prowess Many tech-savvy seniors love to do their own repairs. Whether you have direct experience with home appliances, are self-taught, or just love to tinker, a senior with experience fixing household appliances, plumbing, and HVAC issues may not need a home warranty. If you have managed to repair multiple electronics and appliances in your home and have seen improvement in their performance, then continue to repair items as is.
• The Cost and Frequency of Repairs If you find the costs and frequency of appliance and home electronics repairs are impacting your monthly budget, then a home warranty is probably a good solution. If you do choose to go with a home warranty, ensure the warranty specifically covers those items within your home that are nearing their end of life.
• A Reliable, Low-Cost Repair Service Many of today’s seniors benefit tremendously from local HVAC service and repair contractors that provide numerous discounts and rebates. Similar rebates are often available through large retailers. If you’ve developed a close relationship with a local contractor or electrician who continually comes through with low-cost solutions, then it’s best to forego the home warranty altogether.

Endless Savings and Rebates for Seniors Through WiseSavings

Whether we’re helping our 250,000+ seniors save on groceries with numerous rebates and discounts, helping them with retirement planning and reducing monthly expenses, or providing them with help on how to navigate insurance, medical care, and federal assistance programs, the WiseSavings team is always looking to help our members.

If you are over 55 and want to join a community of like-minded seniors who love to live vicariously while saving money, contact us now.