Best Home Warranty Companies

According to the National Home Service Contract Association (NHSCA), a home warranty isn’t technically a warranty at all. The NHSCA says, “Warranty is a marketing term and one which real estate professionals use as well.”

Home warranties aren’t required to own a home nor are they a replacement for homeowners insurance. A home warranty usually covers repairs and replacement of appliances and systems that break down due to normal wear and tear. A homeowners insurance policy will pay to replace or repair damaged or destroyed items due to a covered event like a fire or theft.

If your home has been newly built or remodeled, it more than likely comes with a builder warranty. This warranty would cover permanent items of your home, including the following:

If you want a home warranty, which helps replace and repair items like your AC or appliances, you will need to pay for it. However, sometimes, a real estate agent can buy the home warranty. In this case, a real estate agent may purchase a home warranty plan as a closing gift, if it isn’t already purchased or included in the contract of the sale.

The seller could also include a home warranty in the price of a home. When a seller does this, it is typical for the home warranty company to provide coverage during the listing period as well.

A home warranty works by giving you a way to save money on covered appliances and home systems in the event they break down through normal use.

For more information, see our How Does a Home Warranty Work? guide.

A home warranty is meant to complement your homeowners insurance policy, not replace it. A warranty covers the cost of repairs and replacements to your home’s major appliances and systems due to normal wear and tear. Don’t expect the warranty to provide coverage against natural disasters or theft of the covered items.

A company will only pay for items specifically outlined in the contract and up to a specific amount. For instance, a company may not pay more than $1,500 for an appliance repair or replacement.

Your homeowners insurance policy, on the other hand, will pay for damage and loss of property due to a covered peril, such as storms, theft, and vandalism. In addition to damage or loss of personal assets, a policy covers damage to the interior and exterior of the home and liability for accidents that take place on the property.

A home warranty generally covers major appliances and your home’s systems. Exactly what your home warranty covers will be listed in your contract. While some companies provide individual plans that only cover appliances versus only systems, many offer combination plans that cover both.

The covered appliances are generally major appliances such as refrigerators, dishwashers, washing machines, and clothes dryers. Home warranties will spell out what is and isn’t covered in the contract, so if your stand-alone freezer isn’t in the contract, it isn’t covered. Although, you may be able to add on coverage for it.

Home systems like your electrical, plumbing, water heater, and HVAC are also generally covered in plans that cover systems. But you may need to add extra coverage for your sump pump or septic system.

The following tables explain the major systems and appliances covered by our Best Home Warranty Companies. For more information on what a home warranty covers, read our guides What Does a Home Warranty Cover? and Home Warranties vs. Homeowners Insurance.

Typically, home warranties don’t cover some of the following:

Most of the exclusions are self-explanatory, but one that might be confusing is preexisting conditions. With most home warranty policies, there is a 30-day waiting period before protection starts. This rules out preexisting conditions or appliances and systems that didn’t work prior to coverage starting.

For all exclusions, it is important to read the fine print of your contract.

Most of the companies in our rating offer some type of roof coverage, whether as part of a standard plan or as an option. This coverage is usually limited to roof leaks. Select Home Warranty includes free roof coverage in all three of its plans, while American Home Shield has the best payout for roof leak repair.

It is important to keep in mind the difference in roof coverage between a home warranty and homeowners insurance. A home warranty may cover a roof leak resulting from normal wear and tear. A homeowners insurance policy will generally cover damage to your roof resulting from a covered event like a storm. Also, a home warranty may pay to repair a roof leak but won’t cover any damage caused by the leak.

Read What Does a Home Warranty Cover? for more information on home warranty coverages.