Understand the Differences between A Home Warranty Plan and Home Insurance

 Purchasing a home is one of the most critical investments for us and as a homeowner, we all want to protect our homes. There are two legitimate ways to protect your home- purchasing home insurance and a home warranty plan but unfortunately, a lot of people don’t understand the difference between home insurance and a home warranty plan. While they may sound similar, they cover different things and serve different purposes. In this article, we are going to explain what home insurance and a home warranty plan are, the differences and the benefits they provide you with.

 

 

What is a home warranty?

 

A home warranty is a monthly or annual service contract that covers the repairing or replacement costs of major home appliances and systems that may break down due to regular wear and tear. A home warranty is not mandatory, but if you want to avoid the unnecessary costs of repairing or replacing a major item, having a warranty would be a good idea.

 

What does a home warranty contract cover?

 

Usually, a home warranty plan covers the following items-

 

·  HVAC (Heating, Ventilation, and Air Conditioning) systems

·  Plumbing systems

·  Electrical systems

·  Kitchen appliances

·  Washer and dryer

·  Garage door opener

 

The home warranty plan’s coverage depends on your budget, the size of your home, and your location. You can also purchase additional coverage for your swimming pool, spa, automatic garage door, roof leakage, etc.

 

What is home insurance?

 

Home insurance is a policy contract that covers the structural and personal damages to your property due to unforeseen situations like theft, fire, hailstorms, flood and other natural disasters. Having home insurance is a must if you have a mortgage. When it comes to protecting your home, having home insurance would be a great idea.

 

What does home insurance cover?

 

·  Repairs and replacement costs of the physical structure of your home

·  Covers the costs of personal belongings

·  In case of an injury, it covers the legal and medical expenses of that

·  Covers the temporary living expenses if your home becomes uninhabitable

 

Now, it’s time to know the difference between a home warranty plan and home insurance-

 

Coverage: Like a home warranty plan, home insurance doesn’t cover appliances and systems, instead it covers the structural damages to your house against the perils like theft, fire, hailstorms and other natural disasters.

 

Cost: A home warranty plan comes with a lesser price than home insurance. Most home warranty plans range between $300 to $600 while home insurance costs $1,000 to $3,000.

 

Renewal: A home warranty plan can be renewed annually, while home insurance can be renewed half-yearly as well.

 

Requirements: Home warranty plans come with fewer requirements than home insurance. Your home insurance company will inspect the asset value of your home before determining the costs of the policy.

 

 

When it comes to protecting your home, it’s important to have both the investments. If you are planning to purchase the best home warranty plan at the best market price, click here.

 

 

 

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