Do I Need a Home Warranty? Five Scenarios When The Answer is Yes

Do I Need a Home Warranty? Five Scenarios When The Answer is Yes

a couple moving into a new home covered by a home warranty policy

Key takeaways:

  • Buying or selling a home with a warranty plan can increase property value, reduce time on the market and protect against unforeseen repair costs.

  • Aging appliances and systems benefit significantly from warranty plans, potentially saving homeowners money on expensive repairs or replacements.

  • For homeowners with tight emergency budgets or who own rental properties, home warranties ensure protection against unexpected repair costs and maintain tenant satisfaction.

  • Home warranties complement homeowners insurance by covering everyday wear and tear on appliances and systems, offering comprehensive home protection.


With the joys of homeownership also come many responsibilities. Over time, home appliances and systems wear down and stop working. Naturally, these costs often fall on you when you're the homeowner.

Thankfully, there’s a solution that may help. With a home warranty plan, you can help protect your finances and avoid costly, unexpected repairs.

According to ConsumerAffairs, 25% of all homes sold in 2020 had home warranty plans. Since then, the industry has continued to grow, and more and more people are investing in home warranty coverage. This growth must be happening for a reason, and many people are asking themselves, "Do I need a home warranty?"

Let’s review some of the basics of home warranty coverage and explore some scenarios where home warranty plans are particularly beneficial. By the end of this article, you’ll be able to firmly decide whether you need a home warranty plan.


Is a home warranty required?

No. However, although a home warranty plan is not required, many homeowners are turning to home warranty companies to protect their appliances and home systems. Home warranty coverage offers peace of mind that when your beloved appliances and systems stop working, you’ll know exactly who to call to fix them while potentially avoiding hefty expenses.


So, when do you need a home warranty?

Home warranty plans may help save any household from the pain of expensive repairs and replacements, but there are specific scenarios where home warranty coverage can be particularly beneficial. Here are some of those instances and why you can benefit from having a home warranty plan.


when you need a home warranty infographic



1. When buying a house

This is especially true if you are buying an older home where the appliances and systems have experienced significant wear and tear. Let’s face it: even the most honest seller might miss some issues that exist with home appliances during the sale. Having the right home warranty plan may help protect you from expensive repairs arising after you own your new home.

Additionally, when you’re less worried about having extra money stashed away for unexpected expenses, you can have more flexibility and money to spend on valuable upgrades to your new home. According to the US Census Bureau, approximately 61% of owners of older homes started a home maintenance and improvement project between 2019 and 2021, spending a median of $4,100 on all during that time. With a home warranty plan in place when buying a house, you can lessen your worries and look into improving your home – a valuable investment.

2. When selling property

According to the Service Contract Industry Council, sellers that provide home warranty coverage sell their homes for $2,300 more on average, and their properties spend 11 days less on the market. This is a big deal!  If you are selling your home, added protection of home warranty coverage can be the catalyst that pushes your home to sell over someone else’s that does not offer the same level of peace of mind. In addition to making smart home upgrades that could increase the value, having a home warranty plan is another strong selling point that could persuade home buyers.

3. When your appliances are aging

Much like humans, our appliances age and wear down over time. Various factors can impact how long an appliance or home system stays working in optimal condition. When your beloved AC system, refrigerator, or washer and dryer starts to give you issues, knowing you already have the right home warranty will potentially save you money on repairs and, in some cases, replacements. As your appliances age, it may be wise to start thinking about when they may fail you and get protection before that occurs. 

4. When your emergency budget is tight

Just like with most types of insurance, you pay for home warranty coverage to lessen the financial blow in emergency/unforeseen sitwwwions. You know your household budget better than most, and unexpected repairs can be a significant setback. Imagine planning a huge family vacation only to realize that you have to spend thousands on your HVAC system. If you have a home warranty plan, you can do your part to help reduce the impact on your emergency budget.

5. When owning rental properties

Home warranty plans may save you lots of money if you own rental properties. Even if your renters are well-vetted and promise to take care of your property the way you do, that isn’t always the case. If you have home warranty coverage, you can rest assured that you have a trusted network of service technicians who will be there for you if you need them.

Not only will this help protect you from unexpected costs, but you will also have quicker service and repair time to keep your renters happy. This will help you maintain good tenants and support a steady income flow from your rental property.


Do you need a home warranty if you have home insurance?

This is one of the most common questions about home warranties. The short answer, as we’ve learned so far, depends on your sitwwwion. Unlike homeowners insurance, home warranties are not required by mortgage lenders, but having both is the best form of home protection you can get. 

Although very important, homeowners insurance does not offer the same protection as home warranty coverage, and there is a big difference between them. Homeowners insurance protects you from catastrophic disasters such as fires affecting your home. On the other hand, home warranty plans protect your appliances and systems from normal wear and tear. This includes things such as your microwave, refrigerator and HVAC systems.


How much can you save from a home warranty?

a woman calculating if she needs a home warranty

According to a report from insurance firm Hippo, homeowners spend an average of $6,000 annually on maintenance and repairs, with emergency home repairs averaging $1,953.

Meanwhile, the average cost of a home warranty plan ranges from $35 to $60 per month for a standard plan and $50 to $110 for a higher-level plan. Service fees range from $75 to $125 per visit.

So, as you can see, having a home warranty plan may be worthwhile.


Should you get a home warranty? Other things to consider:


Coverage options 

Home warranty plans come in a variety of sizes and shapes. Every home has different and specific needs, and most home warranty providers have plans that are designed to meet the needs of your budget and household. Be sure to ask about coverage options and read the fine print.

Your location

 If you are in a place with an extreme climate, specific systems and appliances can be at a greater risk of breaking down. Although it is good to look at the average lifespan of your appliances, your systems and appliances might be more susceptible to issues if you live in certain locations. Having proper coverage can help spare you from costly repairs. Additionally, the cost of plans can differ based on state regulations.  


Like with insurance, you can choose to have higher deductible plans or plans with higher premiums. Ensure you know and communicate your needs well when shopping for the right home warranty plan to have a deductible that fits your coverage needs.


Related Article: How to Buy a Home Warranty That Fits Your Needs


How to use it

Using a home warranty plan isn’t as complicated as it seems. Here’s how it works: 

  • Verify and understand your coverage 
  • Request a service visit to file a warranty claim 
  • Pay the service fee and uncovered repair expenses 

When you have the right coverage, you can save time, money and stress by knowing that you have a plan to get your appliances and systems back in working order.


Discover the best home warranty plans with Cinch

Cinch Home Services offers various plans for you to choose from.  

Cinch Home Services was named a four-time award-winning brand by ConsumerAffairs based on real customer experiences. We aim to be as transparent as possible — we don’t hide anything in the fine print — so you’ll completely understand your Cinch home warranty coverage and exclusions. 

Check out our home protection plans and customer reviews to find the best annual plan for you. You can also request an instant quote on any home warranty plan to secure the best home warranty* contract with Cinch today.


*The product being offered is a service contract and is separate and distinct from any product or service warranty which may be provided by the home builder or manufacturer. 

“Do I need a home warranty?” is a common question people ask when they own a home. Here are 6 scenarios when you do need one.

Your home protection is ready and waiting!