How To Choose A Home Warranty Company?

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With so many home warranty companies out in the market, the number of home warranty scams has really increased. This has made it difficult for homeowners who are interested in purchasing a home with a warranty. To make it easier for homeowners, we are going to give out tips that can help homebuyers buy the right home warranty plan that will help them ensure that their home appliances and systems are adequately covered.  But first, we need to understand more about home warranty- what it is all about and how it works.

What is a home warranty?

A US home warranty is a service contract that covers the cost for repairs and replacements of home appliances and systems. Some of the appliances covered include oven, microwave, dishwasher, refrigerator, etc. The systems covered may include the HVAC, electrical, plumbing system, and a water heater. However, the range of items covered will depend on the kind of plan the homeowner has purchased. There are generally two main plans, including the basic plan and the comprehensive plan.

How does a home warranty work?

Well, when your appliance or system breaks down to work due to age or normal wear and tear, you contact the home warranty company and file a claim. The company will send a contractor who will come to assess the appliance or system. If the item is covered under your warranty contract, the home warranty company will cover the cost of repairs or replacement if necessary.

The only thing that the homeowner will be required to pay is a flat service call fee, which ranges from $60 to $100. Generally, a home warranty works similarly to homeowners insurance because the homeowner must pay an annual or monthly premium. The only difference is what they cover- home warranty covers home appliances and systems, while homeowners insurance covers the whole house structure against theft, fire, floods, etc.

A home warranty plan can help homeowners save hundreds or thousands of money on costly repairs and replacements. Research shows that homeowners can spend thousands of dollars annually on repairs and replacements. This amount is way higher than the amount they can pay on a home warranty. A home warranty generally costs between $300-$600 annually. It is also ideal, especially for people living in older houses with outdated electrical, plumbing, or HVAC systems. It will save them huge sums of money, especially if they choose a home warranty plan that suits them.

How to choose a home warranty company

Here are tips to help you choose a home warranty.

  1. Determine if you really need a home warranty plan

Before you start looking for a home warranty plan, you need to determine if you really need it. To do that, you can use a home maintenance calculator to check the approximate cost of maintaining your appliances and systems, and then comparing it with the cost of a home warranty plan for your home.

Get your friends or neighbors opinions

It is also advisable to talk to your friends or neighbors who have purchased home warranties. Find out from them the best warranty companies in your area and their experience dealing with the companies. Again, there are numerous sources on the internet where you can learn more about the home warranty.

Do your research diligently

Once your family, friends, or neighbors have recommended some of the best home warranty companies, you need to make a list of all these companies. Do extensive research about them and read their reviews. The best place to read reviews about these companies is on the internet or the websites of these companies.

When researching these companies, be keen on their deductibles, the total number of reviews, their experience level, reputation, etc.

Get quotes

Once you have narrowed your list, you need to find out how much their monthly or annual premium is. You can get quotes from the companies you are considering to work with. You can send them an email requesting their quotes or simply give them a call and request a quote.

Know what items the company covers

Home warranty companies vary when it comes to the level of coverage they offer to their clients. So, as a homeowner, you need to determine the kind of plan you want to purchase. Do you want a plan that only covers your appliances, only your home systems, or a combination plan?

Additionally, the range of appliances covered varies from one company to another. That’s why you must know the items the home warranty company you are considering will cover before you finalize the contract. And if you want to choose add-ons, calculate the cost of your annual or monthly premium after adding the extra costs.

The company’s service call fee

The service call fee generally varies depending on the price of the home warranty plan. The service call fee usually ranges from $60-$120, depending on the home coverage policy you are opting for during the time of purchase. But generally, the higher the annual premium, the lower the service call fee or deductible.

As a homeowner, you can roughly estimate how often you require service calls. If the service calls are somehow low, you may consider going for a slightly higher deductible. Again, it is worth mentioning that you need to keep your budget in mind when choosing a home warranty plan.  After all, your budget plays a huge role in determining which home warranty you should opt for.

The company’s turnaround time

Another thing that you should be keen on when choosing a home warranty company is their turnaround time. Talk to their customer service representatives and find out the average turnaround time for their services to be completed. The last thing you want is to wait forever for the company to come and fix your HVAC system or oven. That’s why you need to how much they will keep you waiting before they come to your rescue. If you are not comfortable with the duration, you can look for the next company.

Go through the contract and read it carefully

Of course, you are purchasing a home warranty plan to offer additional protection to your appliances and systems. It won’t make sense if you purchase a plan that won’t cover most if not all of your appliances and systems. This is why you need to read through the policy to know what items are covered and any terms [if any].

You wouldn’t want to get the shock of your life when your claim is denied and the reason is that the item isn’t covered by the contract. That’s why it is important to read the contract and understand its content.

The company’s customer service

And the last thing that you need to pay attention to before you sign any agreement with the home warranty company is their customer support. Be keen on how the company’s customer service representatives treat clients, and if they answer questions properly. Also, notice how friendly they are and if they seem willing to help.

You can learn all these the first time you interact with them. If you notice any red alert, avoid the company.  The customer service representatives are the face of the company, and if they cannot treat you properly, then that tells you a lot about the company. Another thing, check how responsive the company is. Your appliance or system can break at the wrong time, and you wouldn’t want the company to take too long before responding to your distress.

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