Does a home warranty cover foundation repair?
Foundation damage can spell major trouble for your home. Not only is repair costly, but even seemingly small cracks could eventually lead to structural defects or water damage.
Foundation repair costs range from a few hundred dollars to a few thousand for most homeowners, but it can be far more expensive if structural problems result, becoming tens of thousands very quickly when major intervention is required.
Given the cost implications and the importance of the foundation to a house’s overall safety, condition and value, many homeowners seek additional coverage for foundation damage.
Unfortunately, coverage options for foundations vary, and it isn’t always included in standard packages. What type of damage is covered by which type of coverage?
This article explains some of the warranty and insurance options available for foundation repair.
What a home warranty covers on your home’s foundation
In general, there are three types of coverage that you can get for a home: homeowner’s insurance, home warranty and builders warranty. Each offers unique home coverage.
For example, homeowners insurance policies cover damage, theft, loss or liability associated with your home and can be thought of more like emergency coverage for major incidents. Builders warranties typically offer coverage for the workmanship, materials and some structural defects in newly built homes.
In contrast, a home warranty applies to your home’s systems and appliances, not structural or disaster-related issues. Home warranty coverage is designed to protect you from the types of damage that your home insurance policy or builder’s warranty doesn’t cover — the cost of repair or replacement for damage caused by daily wear and tear on your most-used appliances. A home warranty plan usually does not include coverage for foundation damage.
Even if home warranty plan coverage doesn’t directly impact foundations, it still helps protect you from foundation damage, though. A warranty company often covers plumbing systems, and since water and moisture issues are the most common causes of foundation damage, maintaining your home’s plumbing is one of the most important elements of foundation maintenance.
How a builder’s warranty works for your home’s foundation
Most likely, a builder’s warranty with foundation coverage will be the best bet in protecting your family from costly foundation repairs due to structural and environmental issues. Typically, a builder’s warranty is provided by the construction company or contractor who built the house, and it covers certain types of foundation repairs for one year. However, some builders offer extended warranty options that last 2–10 years.
The definition of “foundation” depends on how the house is built and what the warranty details are. In general, the foundation is considered to be the lowest load-bearing portion of a home, and it could include a full basement, a crawl space or a slab.
Regulations and standards on builder warranty plans vary widely by state, provider and company. If you are in a newer home that includes a builder’s warranty, make sure you are informed about the coverage details, the warranty period and the specifics of the contractor liability on your particular plan.
While a builder’s warranty may provide coverage for foundation issues, structural warranties also cover issues related to other key load-bearing components — from load-bearing walls to roof-framing systems. So, an extended builder’s warranty might be more than you need if you are only looking for foundation coverage and could end up costing you more than necessary.
If a builder’s warranty does not work for you, or if the construction company does not provide one for your needs, you can look into a foundation warranty. A foundation warranty is a specific type of coverage related to the construction of a home’s structural elements and can be purchased from a third-party provider in some cases. For instance, if you live in an older home that is no longer covered under a builder’s warranty and you get foundation repair work done, the foundation repair company may offer you warranty coverage on their work.
How to determine what your home warranty package covers and does not cover
Because there are so many different scenarios and different types of coverage surrounding foundation defects, it’s important to be clear on when issues fall under homeowners insurance, a builder’s warranty, or a homeowner’s warranty plan.
Many home warranty plans do offer add-ons to regular coverage, so if foundation damage and repair is not listed on a warranty company’s website or online quoting system, the best way to find out whether foundation coverage is available is to speak to customer service for more details.
Remember: Home warranty plans are specifically designed to protect you from the kind of damage that your home insurance policy and builders warranty overlook, such as daily wear and tear on your appliances.
But home warranties also help you keep up with the maintenance of your home — first, by requiring regular maintenance to maintain coverage and also by helping you find qualified repair service quickly and easily so that repairs occur immediately when needed. This helps you take care of your home and avoid prolonged maintenance issues that could lead to more serious problems, like foundation damage.
The ability to properly maintain your home and get easy access to a qualified repair service when you need it is part of what makes a home warranty worth it.
Knowing that the appliances and systems you rely on every day are covered helps relieve stress when more complex issues such as foundation repair or structural defects come up. That’s why it’s always ideal to invest in a broad range of insurance and warranty coverage, including a home warranty plan.