Essentially, a home warranty plan protects your home from any unanticipated mishaps. It is an annual contract that will cover the cost of repair, if any important home systems or appliances were to break.
Here, we will break down the typical cost for a home warranty, what it covers and what it doesn’t, as well as the importance of having a home warranty plan.
Who pays for a home warranty?
This is dependent on what the local custom is in your area. It’s on the buyer to have a home warranty in place, but sometimes the seller will pay for the buyer’s home warranty plan as an added benefit.
Also, a Real Estate agent may even gift their buyer a home warranty during closing.
How much does a home warranty cost?
The average premium for a home warranty plan in Florida’s currently $317.23, according to homewarrantyreviews.com. Depending on your coverage options, this number can fluctuate.
The policies are usually prepaid for the year and renewed annually as they expire. There also may be a deductible involved, so do your research when choosing a plan.
How does it work?
All plans offer different types of coverage, but the verbiage and circumstances are usually the same. A major appliance or home system breaks, the homeowner calls the home warranty company, and the company then reaches out to their provider to have the issue resolved.
The home warranty company will pay for the service and any replacements needed. However, the homeowner usually does pay a small service fee. This fee can range from $75 – $100.
What are the different types of coverage?
When negotiating your home warranty plan, it is important to go over it with your Real Estate agent. They will be able to provide useful input and even recommend companies to do business with.
Issues typically covered under a standard home warranty policy include:
- A/C
- Kitchen appliances
- Washers/dryers
- Doorbells
- Furnace/heating
- Water heater
- Duct work
- Garbage disposals
- Plumbing
- Ceiling fans
- Electrical systems
Issues that may not be covered could be, but not limited to, outdoor systems such as pools and sprinkler systems, permit fees, items broken prior to closing, and, occasionally, faucet repairs.
Other items to consider
Sometimes your claim may be denied due to improper maintenance, code violations, pre-existing conditions disclosed in a home inspection, and improper installation.
If you truly are dissatisfied with the service from your provider, you may have some negotiating room if you got the recommendation from your Real Estate agent. They tend to have close working relationships with their home warranty providers and can possibly provide you some leverage.
