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10 questions to ask a home warranty company

Everything to know before buying a plan

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    Home warranties let you worry less about budgeting for big repair bills, but not all home plans provide the same level of service or coverage. You’re much more likely to find a great warranty for your needs if you compare a few companies before making a final decision — do your homework by asking home warranty providers the following questions.

    Key insights

    • Make sure the plan covers the specific systems and appliances you want to protect.
    • When comparing costs, factor in your monthly or annual payment plus service call fees.
    • Providers sometimes offer discounts or promotions, so it’s a good idea to ask about available deals.

    What to ask

    To get a feel for a home warranty company, ask specifically about what’s covered, what’s not, monthly costs, any coverage limits and how claims and cancellations work.

    1. What does the home warranty cover?

    First and foremost, ask exactly what the plan covers. Look around your home and make a list of all your appliances (refrigerator, dishwasher, washing machine, etc.) and systems (e.g., air conditioning and plumbing). Then cross out the ones you don’t want to cover with a warranty.

    You can use this information to ensure you pick a policy that covers what you need — no more, no less.

    Home warranty plans typically cover mechanical systems and appliances, but this varies from company to company and plan to plan.

    » MORE: What does a home warranty cover?

    2. What does the home warranty not cover?

    There are certain items, systems or situations a home warranty won't cover. These are called exclusions.

    Common exclusions include damage caused by natural disasters, preexisting conditions, improper installation or maintenance, and nonmechanical items.

    Companies explicitly list exclusions in the contract, but make sure to ask just to confirm you understand. Otherwise, you may end up footing the bill for an expensive repair you thought was covered.

    » COMPARE: Home warranty vs. home insurance

    3. How much does the policy cost?

    Most home warranties have two parts to their pricing: your premium (paid yearly or monthly) and the fee you pay for each service call.

    In general, lower premiums come with lower coverage or limits, more exclusions or higher service call fees, while plans with more expensive premiums offer more extensive coverage or have higher limits.

    When comparing pricing and coverage, also ask how long the policy lasts (most have terms from one to three years).

    Jordan Woolf, CEO of We Buy Houses In Bama, a real estate developer based in Huntsville, Alabama, advises to especially pay attention to “automatic renewals, potential price increases and any cancellation fees that may apply.” Some home warranty providers also offer discounts or promotions, so it's always a good idea to ask about any available deals.

    » MORE: Cheapest home warranty

    4. What are the coverage limits?

    Find out if there’s a limit to the number of claims you can make in a year. Providers often limit the overall amount you can file claims for over a period of time. Once you’ve reached that amount, you’re responsible for any other costs.

    They also typically limit the dollar amount they cover. Some companies put limits on specific parts or situations, like capping oven repairs at one amount and electrical repairs at another.

    As with any exclusions, make sure you understand how much your warranty covers for every item within the contract’s scope so there are no surprises later.

    » LEARN: What is a home warranty?

    5. How quickly will warranty claims be addressed?

    Appliances that break can be inconvenient, which makes repair times a vital consideration — especially if you have a broken air conditioner in the middle of summer or need a furnace replacement when it’s freezing.

    Some warranty companies have contractors available 24/7, while others only offer set business hours for contractor availability.

    Ask what the average turnaround time is, and find out what happens if you need emergency services.

    6. What is the waiting period?

    Find out how the waiting period works (if there is one). A reviewer in New Jersey on our site signed up for a warranty with a standard 30-day waiting period: “My garage door opener stopped functioning just over a month after I enrolled. A technician was arranged by then to come, but when he called in to give an estimate for the replacement of the motor, the claim was denied as they said I was within the 30 days period.”

    What they learned: “Apparently, after the first 30 days, the warranty is effective. After that, you have to wait another 30 days to make a claim. This was never disclosed to me when I enrolled.”

    7. What is the cancellation policy?

    “Ask for all the details about cancellation policy before buying the policy,” a reviewer in California advises other potential warranty customers. “It was a headache for me instead of peace of mind.”

    Cancellation policies differ between warranty companies, and the worst time to clarify the details of yours is when you want to cancel. Find out the exact steps — and potential charges — involved in canceling a plan now rather than after you buy it.

    8. Who are the company's local contractors?

    When you make a claim with a home warranty company, it sends out a service provider to repair or replace covered items. You don’t usually get to choose who those contractors are, so you want to make sure they’re reputable.

    Ask if they’re licensed and bonded in your state, how the warranty provider vets them and how the company handles contractors who don’t perform well.

    9. What are my maintenance requirements?

    Home warranty companies usually require that your systems and appliances are properly maintained to be eligible for coverage.

    “Some homeowners may not realize that failing to perform regular maintenance can void their warranty or result in a claim being denied,” Woolf said.

    10. Is the warranty transferable?

    Some people don’t realize that plans can often be transferred to new homeowners when a property is sold. “This transferability can be a selling point, but it's important to understand the terms and conditions of the transfer,” according to Woolf.

    More tips for getting a home warranty

    It's important to understand what you’ll get out of a plan before you buy, and it’s just as important to make sure you’re talking to a good company to begin with.

    Hearing about other customers’ experiences is the best way to ensure you’re choosing a reputable company. Reading reviews will also give you a sense of the quality of service the company provides.

    Pay attention to whether the reviewer has filed a claim. Sometimes people give a company a good rating just because their rep was nice over the phone, but that doesn’t tell you much about the actual claims process or services.

    Comparing multiple quotes when buying a home warranty is the best way to find a plan that meets your needs and budget. It also helps you avoid overpaying for a plan that provides the same coverage as a less expensive option.
    Your service contract should specify what work will be done, who’s responsible for what, how much will be paid and other crucial details.

    There are exclusions to most home warranty plans, so read the terms and conditions carefully to understand what is and isn't covered. A lot of negative warranty reviews are because the person didn’t really understand what they were getting, like this customer in Louisiana: “There's always the little fine print that you don't see when you first sign up and I don't like the little nitpicky rules and get-arounds that they seem to find to not cover your issue.”

    » STILL DECIDING? Best Home Warranty Companies

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      Bottom line

      A good home warranty can save you money if your home systems or appliances break down, but a bad one will cause you a lot of headaches. You have to be vigilant; some companies don’t necessarily have your best interests in mind. Don’t be afraid to ask for clarification if you’re confused about something. Some reps are intentionally vague when explaining exclusions or limitations of the service contract.

      » STILL NOT SURE? How to get a home warranty

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