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What is a home warranty, and what does it cover?

What is a home warranty?

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A home warranty is a service agreement between a homeowner and a company that states the company will cover the repair and maintenance costs of home systems and appliances for a given period.

A home warranty typically covers major home and kitchen appliances like refrigerators, washing machines, clothes dryers and dishwashers. They also cover electrical systems, plumbing, HVAC systems, gas lines, swimming pools and more. Depending on the scope of your contract, home warranties can cover costs due to normal wear and tear as well as replacements in the event of breakdowns or malfunctioning systems. A home warranty does not cover structural elements of a home, such as doors or windows. They also don’t cover stand-alone or smaller appliances like electrical fans or countertop ovens.

Purchasing a home warranty can seem costly at the outset, but it makes good financial sense in the long run. Home warranties can translate to significant savings on maintenance, repairs or replacement of appliances and systems that you would otherwise have to pay out of pocket. This is especially true for older appliances and systems or those in older homes. You’ll pay for a home warranty by paying a set monthly or yearly premium, but this cost means you have the security that your systems are covered, even in the case of major breakdowns.

Let’s take a closer look at the various aspects of home warranties and what they mean for you.

How do home warranties work?

A home warranty is distinct from a manufacturer’s warranty, which only covers service, repair and sometimes replacement costs for a specific product or system. Home warranties, on the other hand, can be tailored to cover multiple systems and appliances, irrespective of their particular brand or manufacturer. Moreover, they cover the cost of issues usually not included under home insurance plans.

Let’s look at an example to understand how home warranties work in simple terms.

Imagine you buy and move into a brand-new house. The location is great. The neighborhood is pleasant, and the view outside your window every morning is delightful. Everything seems to be in perfect working order — until you step into your second-floor bathroom for the first time and nothing works. All the other bathrooms are fine, but this one doesn’t seem to have any water coming through to the bath, shower or faucets.

If you don’t have a home warranty, you’ll have to locate and call a plumber to go about fixing the problem. If the problem turns out to be minor, you're probably on the hook for a couple hundred dollars. If it ends up being major — for example, repairs require breaking into the bathroom floor to replace a broken pipe or fixture — you could be looking at a bill for several thousand at least.

Now imagine the same set of circumstances, except this time, a competitive warranty service like Cinch Home Services covers your home. In this case, all you’d need to do is contact Cinch customer care over the phone or online and explain your problem. Cinch will have a qualified repair professional to your home in no time to diagnose the problem and give you an estimate of the time and money it will cost to set things right. Even if your problem turns out to be major, you’ll probably pay a fraction of the cost you would have paid otherwise. Your only cost is a small service fee. With a home warranty, it’s as simple as that.

What’s more, Cinch offers a 180-day workmanship guarantee on all repairs and maintenance covered under its plans. In other words, your peace of mind is guaranteed with a Cinch home warranty!

What do home warranties cover?

Now that we have clarity about what a home warranty is and how it works, let’s focus on the range of covered items, which include appliances and systems. Coverage can extend to some or all of these appliances and home systems, depending on the plan you choose and the terms of your home warranty agreement.

Home appliances

Dishwashers
Refrigerators
Clothes washers
Clothes dryers
Built-in microwaves
Cooking ranges
Cooking range exhaust hoods
Ovens
Cooktops
Trash compactors
Freestanding ice makers
Freestanding freezers
Built-in food centers
Swimming pools
Spas
Well pumps
Water softeners
Garbage disposals

Home systems

HVAC systems
Water heaters
Home heating systems
Air-conditioning systems
Electrical systems
Plumbing
Gas lines
Sewer lines
Water lines

Home warranty plans can be customized to cover both old and new systems and appliances. Suppose you have one or more new appliances already covered by manufacturer warranties. In that case your home warranty plan can expand on the manufacturer's maintenance, service and replacement coverage. Additionally, the home warranty on these appliances will continue to hold even after the manufacturer’s warranties have expired.

Home warranties are recommended in a variety of circumstances. For instance, they are a must if you’ve bought a new home but are not familiar with the history of its appliances and systems. They can also prove to be a great money-saver for existing homeowners whose systems and appliances are getting older and require frequent service calls. And last but not least, an active home warranty can make the deal that much more attractive to potential buyers.

To give you an idea of how much difference a home warranty can make, consider the following statistic: According to Costimates.com, the average cost of repairing a water heater in 2022 was $455. However, depending on the problem's severity, the actual cost can range from anywhere between $150 and $1,000. Similarly, a broken water pipe takes an average of $930 to repair, with homeowners needing to spend anywhere between $340 and $1,600 to fix it, depending on the nature of the problem.

What’s not typically covered by a home warranty?

As we’ve seen so far, a home warranty offers comprehensive coverage to most major home systems and appliances. Now let’s zero in on the list of items and conditions that are typically not covered by a home warranty service contract.

Below are some items and conditions typically not covered:

Minor or freestanding appliances. This category includes things like your TV, music system, electric kettle, air purifier, lights and fixtures and personal electronics.
Structural components. This includes your house foundation, walls, doors, windows, roofs, gables and gutters.
Things outside the home. This includes your driveway, gates, garage, yard, gazebo, patio, deck, etc.
Rust, mold and corrosion. Home warranty plans usually do not cover mechanical breakdown of home systems and appliances caused by these conditions.
Pre-existing conditions. These include failures or breakdowns resulting from improper installation, lack of maintenance or modification. Such instances are usually passed on by previous homeowners or caused due to prolonged absence. You can hire a home inspector or contractor to identify pre-existing conditions and maintenance neglect before signing a home warranty contract.
Incidental costs. Only some home warranty plans cover incidental costs associated with repair and servicing. Incidental costs can come up in a range of situations. Some examples of incidental costs include gaining access to plumbing under concrete floors or inside solid walls, modifying new equipment to make it compatible with existing equipment, or disposing of old equipment.
Secondary damages. Secondary damages are those caused by malfunction or breakdown in a home system or appliance. For instance, fire damage caused by sparking in a faulty HVAC system component counts as secondary damage. In such a case, a home warranty will cover the repair or replacement of the component but not the cost of any damages to the walls or ceiling that might have happened consequently. Another example is water damage caused by a burst pipe. These costs are likely to be covered by your home insurance plan.

Pros and cons of home warranties

A home warranty is an easy way to ensure that important systems and appliances in your home are regularly maintained to operate in top-notch condition. Home warranties can help you avoid the hassle of taking care of every bit of equipment yourself. With this kind of coverage, you won’t have to jump in every time something goes wrong.

Here are some advantages of having a home warranty:

Savings. Let’s say your central air conditioner is 10 years old and breaks down suddenly in the middle of a hot, summer day. You call in an HVAC professional hoping for a quick fix, only to learn that your air conditioner is beyond repair. Now for the really bad news: The average cost of replacing a central air conditioning unit comes to $5,644, plus another $1,250 to $2,300 for installation. If your existing ductwork needs upgrading, you’re looking at up to $3,600 on installation alone. The air conditioner is just one of many home systems that can face a breakdown. With a home warranty plan in effect, you’ll have to spend only a flat service call fee and a deductible that usually adds up to a fraction of the total repair costs. By paying a fixed monthly or yearly premium, you’re free from unexpected costs that could wreck your budget or leave you to dip into your emergency fund. In other words, a home warranty, in the long run, means huge savings.
Convenience. Issues with home appliances and systems can be frustrating to deal with. Without a home warranty, you’ll have to hunt for a technician, usually after combing through never-ending user reviews online. Once you find a professional you’d like to work with, you might think the worst part is over. But that’s rarely the case. Most repair companies deal with many calls a day, which means there’s usually a significant wait time before someone shows up at your door. On the other hand, if you have a reliable home protection plan such as from Cinch, all you need to do is call customer care over the phone or contact them online. If more than one appliance or home system breaks, your home warranty will take care of it all at the same time. It will schedule a skilled technician to show up at your home to fix your problem (or multiple problems) quickly. You’ll only need to pay a small service fee, so no negotiating or bargaining is required.
Peace of mind. This is perhaps the greatest advantage that home warranties provide. The savings, convenience and overall dependability contribute to your peace of mind. There won’t be any surprises, shocking expenses or waiting around to get things fixed!

Objectively, there aren’t any practical or economic disadvantages to getting a home warranty. However, some people have complaints, usually concerning the extent of their coverage. Let’s look at some of the top gripes with home warranties:

Surface or cosmetic issues. Accidentally dented your dishwasher front panel? Are you having a hard time ignoring the nicks and scratches on your refrigerator door? We wish these minor nags could be papered over and made perfect again! However, cosmetic issues like dings and scratches that don’t affect the operation of an appliance or system are not covered by home warranties.
The stuff outside your home. You might have spent a pretty penny building a new patio by the garden or changing the shingles on your roof. But your home warranty doesn’t cover home repairs on these and other items outside the house.
No repairs needed. Another complaint many people have about home warranties is that sometimes you can find yourself paying for the service and not needing any repairs for the whole year. When this happens, a home warranty might seem like an unnecessary expenditure. The truth is, however, that a home warranty is something you’re much better off having and not needing than not having when you need it the most.

How much does a home warranty cost?

The price of a home warranty depends on several factors: the range of systems and appliances you want coverage for, the type of home you live in, and your location (state, city or town). Prices differ according to geographical location mostly because of the variable cost of living standards and other local factors.

You can opt for home appliances coverage, home systems coverage, or a complete home warranty coverage that includes both. You might also have to pay extra over standard plan prices for additional coverage. Get a quote to understand the pricing details of each plan before signing up for a warranty.

There may also be a waiting period after you’ve paid for a plan and before it becomes effective. That period typically ranges anywhere from 14 to 45 days.

Are home warranties worth it?

Unless you’re a skilled technician with years of experience working on a wide variety of home appliances and systems, the answer to whether or not home warranties are worth the cost is an unequivocal yes!

As we’ve already seen, paying out of pocket for every little repair and service can add up to quite a sum over a year. Add to that the time and energy you’ll have to expend on every one of these incidents, and you’ll see that having blanket coverage on all important appliances and home systems makes a lot of sense.

When you look at the long-term impact of home warranties, it’s usually clear that they pay for themselves.

How to choose the best home warranty for you

Now that we understand how important having a home warranty is for you and your family, let’s tackle the question of selecting the right service provider. Here are the qualities you should look for:

Clear contract. Choose a service provider that offers a transparent contract with well-defined terms and conditions, clauses and exclusions. This will help ensure there are no surprises buried under the fine print.
Market reputation. Research generously for user feedback, comments left on review platforms, and independent appraisals on home warranty reviews websites. Following this step will help you gain a fair assessment of the service provider’s reputation.
Reach and network. Ideally, look for a provider that operates across various states and territories. An established service provider with a presence across locations is likely to be more reliable while offering the best prices on your home warranty.

Cinch Home Services is a trusted partner that promises reliable service at budget-friendly prices. We offer an easy-to-understand home warranty contract with no fine print or hidden clauses. Signing up with Cinch offers you several unbeatable advantages:

Availability. Cinch offers year-round, 24/7 service without weekend breaks or holidays. This means no waiting around for a technician, whether day or night.
Trust. All service partners in the Cinch network are vetted for your protection. We also ensure compliance with local licensing requirements.
Quality. All work done under a Cinch plan comes with a 180-day workmanship guarantee without exceptions.

Home warranty FAQs

For those unacquainted with the finer details of a home warranty, several nagging questions might remain. Here are the answers to some of the most frequently asked questions:

What’s the difference between a home warranty and homeowners insurance?

A homeowners insurance policy is something you buy from an insurance company.

Homeowners insurance covers the cost of losses arising from damage due to external forces like weather, fire, floods and earthquakes. It also covers damages caused by human factors like burglary, vandalism and arson. Your homeowners insurance will pay for repairs to the whole or a part of your home due to these factors, including costs related to replacing or rebuilding.

A home warranty, on the other hand, covers the cost of maintenance, repair and replacement of major appliances and home systems like refrigerators, dishwashers, electrical systems, plumbing systems and so on. The precise coverage details in the case of both homeowners insurance and home warranty contracts depend on the type of plan and the extent of standard and optional coverage purchased by individual homeowners.

Do home warranties cover existing problems?

The short answer in most cases is no. However, service providers like Cinch will cover pre-existing conditions that could not be detected with a visual inspection or mechanical testing at the time of purchase.

How long does a home warranty typically last?

Home warranties typically last for one year. You can purchase a Cinch home warranty plan by paying fixed monthly payments or an annual lump sum.

Learn more about why so many people choose Cinch home warranties

Cinch is an award-winning home warranty service provider trusted by homeowners and home buyers across the U.S. Our reliable, fast and consistent service record is what sets us apart in the market. The Cinch advantages — such as our 180-day workmanship guarantee delivered by thousands of skilled technicians — are part of our commitment to provide homeowners with unbeatable service and lasting peace of mind. That’s why we’ve processed over 1 million successful claims so far.

So, get ready to forget hefty repair or replacement bills when you sign up for a Cinch Home Services warranty. Our plans provide you with comprehensive coverage of major home appliances and built-in home systems. Or you can choose our home protection plan that gives you complete coverage of all vital assets in your home.