How to Choose a Home Warranty Company

A home warranty can cover things like plumbing damage.

A home warranty is actually a type of insurance. The seller of this insurance creates a policy for homeowners that covers certain areas or items in the home if they should need repair or replacement within a certain period of time. The amount of coverage provided and the length of time that items in your home are covered vary greatly from company to company. You should consider your options carefully before choosing a home warranty company.

Instructions

1. Compare several home warranty companies before choosing one. The biggest mistake you can make is simply choosing the first company that makes you an offer. Comparison shopping will help you find the best deal for the cheapest price, and it's especially important for first-time home buyers. If this is your first time buying a home, then you have less experience with home warranty companies than other buyers.

2. Decide what areas or items in your home you want covered by the home warranty. Compare companies that offer this type of coverage. Some examples of things you might want covered include home appliances, electrical systems, plumbing, heating systems and air-conditioning units.

3. Pay close attention to how the home warranty companies approach repair versus replacement. Look for companies that will replace faulty appliances or systems with units that are of the same or equal value. Also, make sure the policy covers appliances and systems that are as old as the ones in your home. If you have a 10-year-old air conditioning unit, you don't want a policy that will only replace units that are 5 years old.

4. Consider the importance of customer service. The home warranty company you choose should offer highly trained customer service representatives who are available around the clock. If your furnace breaks in the middle of the night on a Saturday in December, you need to be able to get a hold of someone now, not Monday morning.

5. Check out the service technicians the home warranty companies use. The service technicians will be coming into your home to repair your broken systems or determine if they need to be replaced, therefore, they need to be qualified for this type of work. Make sure they have the proper training in their field and all required credentials. You can also check with the Better Business Bureau.

Tips & Warnings

• Read the entire policy before signing it. Sometimes the fine print can include clauses that turn an excellent policy into a useless piece of paper. If you don't understand some of the wording, ask that it be explained to you or hire a lawyer to go over the policy with you.

References

• Saveology: Choosing the Best Home Warranty Company