What does a home warranty cover?

A home warranty can help cover the costs to fix expensive and unpredictable problems with household appliances and systems, like a busted air conditioner or broken dishwasher.

Kitchen appliances, washers and dryers, water heaters and major components of HVAC, plumbing and electrical systems are eligible for coverage, and some plans cover much more. The best way to know what your plan covers is to read the contract.

Home warranty coverage

Home warranty companies typically classify items, such as ceiling fans or air conditioners, as either systems or appliances. Most providers also offer optional coverage for specialty items like pools, spas, septic pumps, well pumps and secondary appliance units.

Typical systems coverage

If you have a home warranty system or combo plan, it should cover most of your interior systems, including:

• Heating system
• Air conditioning system
• Plumbing system
• Electrical system
• Water heater
• Ductwork
• Garage door openers
• Ceiling fans
• Central vacuum

Typical appliance coverage

A home warranty covers any appliances in your home specified in your contract regardless of age. It typically won’t cover preexisting conditions that your older appliances may have before you sign your contract, though. Covered appliances typically include:

• Refrigerator
• Built-in microwave oven
• Trash compactor
• Instant water dispenser
• Garbage disposal
• Dishwasher
• Clothes washer
• Clothes dryer
• Range, oven and cooktop

Optional coverage

In addition to systems and appliances, most home warranty providers offer add-on coverage for an extra cost, including:

• Roof leak repair
• Well pump
• Sump pump
• Septic tank
• Pool and spa
• Water softener
• Guest unit

What home warranties don’t cover

Plans cover your major systems and home appliances, but they don't cover everything that can go wrong. Generally, home warranties do not cover issues related to:

• Preexisting conditions
• Improper installation or maintenance
• Code violations
• Items typically covered by home insurance
• Unusual wear and tear
• Structural elements
• Smart devices
• Solar panels
• Fireplaces
• Mold
• Commercial-grade appliances
• Items under manufacturers' warranties

Home warranties don’t usually cover fireplaces. However, your home warranty may cover the gas lines to your fireplace, which are considered part of your home's heating system. Solar panels typically come with a long warranty from the manufacturer, making them ineligible for coverage.

Home warranty coverage limits

Home warranty providers don’t pay more than the limits listed in your service contract. A home warranty company might list these limits on a per-item or per-term basis. These limits typically range from $1,500 to $3,000, depending on the provider. Expect to see language in your contract like:

“[Provider] will pay up to $1,500 per contract term for access, diagnosis and repair or replacement of [item].”

If a repair or replacement ends up costing more than the coverage limit in your policy, the warranty company may offer you a cash payout instead. In this case, you receive funds up to your coverage limit, but you'll need to make up the difference yourself for the cost to have the item repaired or replaced. You may also have to provide documentation to your warranty provider that you used the cash payout to make the repair or replacement.

Home warranty exclusions

Coverage inclusions and exclusions are where a home warranty provider lists the specifics of a plan’s coverage. The agreement may state that you have coverage for broad items, like “refrigerator” or “electrical system,” but that doesn't necessarily mean all parts and components in those items are covered.

Home warranties generally provide coverage for items related to the essential function of each system or appliance. For example, your home warranty plan might cover your kitchen refrigerator, but it might not cover nonessential repairs. If a rack or shelf breaks, it won’t affect the essential function of a refrigerator, which is to keep items cold.

In this example, the fine print of your contract might look something like this:

Home warranty vs. home insurance

People often mix up the terms home warranty and home insurance. Homeowners insurance pays to cover property damage or liability caused by an accident or catastrophe, like a fire or lightning strike. A home warranty pays to repair or replace specific items that stop working over the course of normal use.

For example, if a power surge from lightning causes damage to an appliance in your home, homeowners insurance helps you cover the loss. If the appliance suddenly stops working because of a part failure, though, a home warranty would pay for the repair or replacement.

Home insurance is usually mandatory if you have a mortgage. On the other hand, a home warranty is always optional. Overall, the differences are in many ways similar to those between car insurance and car warranties.

Compare coverage by company

A home warranty is a service contract for systems and appliances. In exchange for monthly or annual premiums, the provider is obligated to fix or replace covered items for the length of the contract.

It’s essential to read the fine print of a home warranty contract before you sign the agreement. Specifically, look at the coverage details, exclusions and limits. For example, some companies specify that they have the right to ask for maintenance records, so you want to make sure you keep these on hand.

You can find the model home warranty clause for standard residential purchase contracts from the National Home Service Contract Association (NHSCA). We also provide sample contracts from several popular providers below. Reading through these documents should give you a good idea of what you can expect from your plan once you move forward.

Covered systems	14	9	8
Covered appliances	9	9	8
Maximum limit per item	Up to $1,500	Up to $2,000	Up to $3,000
Average cost for combo plan	$60/month	$63/month	$54.75/month
Roof coverage available
Plan details	Sample contract	Sample contract	Sample contract
Learn more	Read reviews	Read reviews	Read reviews

	14	9	Up to $1,500	$60/month		Sample contract	Read reviews
	9	9	Up to $2,000	$63/month		Sample contract	Read reviews
	8	8	Up to $3,000	$54.75/month		Sample contract	Read reviews

Bottom line: What’s included in home warranty coverage?

Home warranties generally cover important home systems and appliances that need repair or replacement after breaking down from regular wear and tear. Specific coverage ultimately depends on the provider and plan — and the details contained in the fine print in the home warranty contract. That’s why it’s so important to read a policy from top to bottom — and to ask a company representative any questions you have afterward — before you sign.

For more, compare home warranty companies on costs, coverage and reviews:

• American Home Shield vs. Choice Home Warranty
• Liberty Home Guard vs. America's 1st Choice Home Club
• ServicePlus Home Warranty vs. Super Home Inc.
• Choice Home Warranty vs. Cinch Home Warranty
• Choice Home Warranty vs. Select Home Warranty
• American Home Shield vs. Select Home Warranty