Home warranties are important tools that can save a new homeowner a considerable amount of money in the long run. However, there are some things you should keep in mind to make sure the policy can be used to your best benefit.
Home warranties are meant to cover major appliances, heating and air conditioning, electrical systems, and plumbing problems that may arise in your new home. You should read over your policy thoroughly to make sure you know exactly what is covered, and what could cause the policy to be voided. Most home warranty plans have a list of things they do not cover, and many include:
- Water faucets and pipes that become blocked
- Sprinkler systems
- Pools or spas
- Routine plumbing or maintenance issues
- Hauling away of old appliances
Some plans may cover these items, or they may be added for additional fees. It is up to the warranty purchaser to verify what is or is not covered on their policy.
Another important drawback of home warranty plans is that there are several things that could lead to a denial of a claim. If you do not maintain the proper upkeep of the appliances or systems, or you do not get routine checks done as required by the policy, your claims will generally be denied. If you attempt to complete a repair on your own, or you have worked on a different problem on your own previously, many companies will no longer cover those appliances or systems. Some companies may even go so far as trying to determine whether there is unusual wear and tear on an appliance, especially if there have been multiple claims made on the same item in a short period of time.
Home warranties can provide a wide range of protections for new home buyers, but they do require you to follow certain guidelines in order to have your claims paid. It is also a good idea to do some research on any home warranty company you are considering. There are many companies who create policies, collect payments, and then close their doors only to reopen under a new name. Still others deny many of the claims submitted, and refuse to repair items that should be covered. Education, and becoming familiar with the company and policy will ensure you get the coverages you need.