What You Need To Know About Home Warranty Plans
Replacing appliances when they break in your house can be very costly. There are a few different ways to reduce your costs, one such way is using home warranty plans. Many people are confused about the differences between a home warranty and home insurance. This article will look at the differences and tell you exactly what you need to know about home warranty plans.
A home warranty plan is designed to provide you protection in case one of your major electrical appliances breaks down. Home insurance on the other hand provides the homeowner protection against defects in the physical structure of their home. Home warranty plans are not required if you have a mortgage, but they are recommended to anyone who doesn't want to have to spend a lot of money replacing appliances in their home.
How much do they cost?
The cost of a home warranty plan will depend on the company you are taking the warranty plan from, and the level of cover that you require. Anyone wanting to take out a home warranty plan can expect to pay between $300 and $600 per year. This exact figure will depend on the types of appliances in your home, and the level of cover that you require.
How do they Work?
These plans all work in the same basic way. If an appliance which is covered on your warranty policy breaks down, then the warranty company will pay to have the appliance repaired or replaced. On the event of a claim the homeowner will need to pay a deductible which is normally between $50 and $100 in order to get the appliance repaired.
Making a claim should be quite easy. You will need to contact the company you took the warranty out with. You will normally need to make a claim in writing. You will then be expected to pay the deductible in order to have the appliance repaired.
Most home warranty policies remain with the house when it is sold. This will mean that when you sell your home the new owners will be able to benefit from the warranty. This could make it easier to sell your house because it has a nice additional feature.
Types of Coverage
You won't want to pay more for a home warranty plan than you have to. To reduce your costs make sure that you choose the correct type of plan with the right level of cover for your home. If you don't have an air conditioning unit for example, then you don't need cover for one. Most warranty companies allow you to tailor your plan to suit your needs.
The items and appliances around your home that will be covered by the warranty plan will depend on the plan that you choose, and the company you buy the plan from. The normal things to be covered are all your household appliances, and also any heating and cooling systems. Most home warranties also include cover for plumbing.
What is not Covered?
Normally clothes washing machines and drying machines are not included on a standard warranty policy. These can be covered by most warranty companies for an extra premium each year. The reason these appliances aren't normally covered is because they get used every day and are more susceptible to failure.
What can Cause a Denial of Payment?
Of course the warranty company won't want to pay out if they have a reason not to. There are some common reasons for the company to deny a payment. These can include making fraudulent claims, or if the warranty company claims that the homeowner failed to correctly maintain the appliance. Sometimes claims could be refused because of a problem which already existed before the warranty plan was taken out.
Home Warranty Plan Providers
It's important that you choose a home warranty plan provider with a good reputation. You will want to improve the chances of your claim being accepted. Check the reviews of any home warranty providers online to try and maximise the chances of receiving a payout if you do claim. Some good home warranty providers to consider include:
1) American Home Shield
A very well known company with generally positive reviews.
Mailing Address: American Home Shield, P.O. Box 849, Carroll, IA 51401-9901
Types of Cover: Many, customisable
Cost: $250-$600 per year with around $75 deductible
2) Home Service Club
Types of Cover: Standard and Comprehensive cover, with optional extras
Cost: Typically around $400
3) Americas First Choice
Types of Cover: Three different levels of cover - Gold, Silver and Bronze
Cost: Around $400 depending on cover
4) Stanley Warranty
Types of Cover: Different levels of cover for electronics, computers and appliances
Cost: Between $300 and $500
5) Landmark Home Warranty
Types of Cover: Several different plans covering many different types of appliances and electrical goods.
Cost: Between $340 and $550
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