What Does a Home Warranty Cover [Know What to Expect]


Settling into a new home can be tricky, especially when complicated terms like home warranty coverage and reimbursement rate are thrown your way!

Don’t worry, this article will answer all the questions which new homeowners might have, like “what does a home warranty cover?” We’ll also discuss exactly how a home warranty works, what it covers, and the common mistakes people make when choosing a plan for themselves.

What Is a Home Warranty?

A home warranty is a contract between the homeowners and a company, which covers the cost of household repairs that occur due to wear and tear. Just like any other form of warranty, the person has to pay a certain fee annually which covers the cost of the service fee that they would have to pay for any repairs. People usually enter into an annual service contract and renew their plans on a yearly basis.

The average cost of a home warranty ranges between $300 and $600 annually. The duration of home warranty coverage depends on the contract signed by the homeowners and the company. On average, people generally go for an 8-10 years cover plan. Moreover, a home warranty is transferable, which means that homeowners can transfer it to new owners if they ever sell their house.

Did you know: Home insurance and homeowner warranty insurance are not the same! People often confuse the two. You can check this article on home warranty vs home insurance differences to learn more.

How Does a Home Warranty Work?

Whenever equipment malfunctions, you contact your home warranty providers to file your claim. The home warranty providers then initiate the repairs process. They send their technician to assess the cause of damage and to determine if it is covered under the homeowners protection plan. The company views the reports. If the claim gets approved, they send a technician for repairs and replacements. Homeowners only pay a small fee or deductible to cover the cost of the repairs which usually ranges between $50 and $100.

Did you know: Home warranty plans can save you thousands of dollars on repairs over time. Systems and appliances will inevitably break down over time.

What Does a Home Warranty Cover?

With so many companies and different home equipment, people often wonder “what do home warranties cover?”. The table below provides a list of all the common things covered in a home warranty plan:

Feature Description
Microwave, oven, dishwasher, refrigerator, etc. Home warranty plans cover many of the kitchen appliances. They are more prone to wear and tear due to their daily usage. Warranty plans normally cover everything from clogs and leaks to system repairs.
Air conditioning, HVAC systems, heater, ductwork, plumbing, electrical system, heating system, etc. They also cover major systems which are common in every household. People can also add other systems for additional payment as per their needs.
Vacuum, alarms, doorbells, ceiling fans, re-key services, etc. Apart from the major equipment, some warranty plans also cover these home appliances.
Did you know: Even after purchasing a warranty plan, you still have to pay for the repairs. However, it is a minimal cost compared to what you might have to pay otherwise.

What Doesn’t a Home Warranty Cover?

Home warranty insurance coverage covers most of the systems and appliances in a household. However, there are a few things that might not be covered:

  • Swimming pools: Swimming pools are generally not covered in warranty plans. People can opt for their coverage as an add-on.
  • Pre-installed equipment: Warranty companies do not cover pre-installed equipment which already has some structural issues. They check for any pre-existing conditions before including it in the warranty plan.
  • Components of home systems and appliances: Many warranty companies do not cover specific parts or components of the equipment. This can include vents, filters for air conditioning, faucets, etc.
  • Misuse of an appliance or system: If the appliance has been misused or not maintained properly, the warranty company can deny its repairs.
Did you know: Many home warranty companies deny warranty claims on ambiguous grounds. It can be difficult for people to go through the entire waiting period only to hear that their claim has been rejected. We’ve compiled a list of the greatest home warranty companies to make sure it doesn’t happen to you!

Key Takeaways

  • A home warranty plan is a contract between homeowners and a company that covers the cost of household repairs.
  • Many people do not know how home warranties work and often confuse them with home insurance.
  • The process involves contacting the company. If the claim gets approved, the warranty company pays for the repairs.
  • A few things which may not be covered include pools, spas, pre-installed equipment, etc. They can be added as extras in the policy.

Common Home Warranty Mistakes

There are a few mistakes that people tend to make while choosing a home warranty plan. These mistakes are especially done by new homeowners who may not know what a home warranty is.

The first mistake is not researching the companies thoroughly. Simply purchasing the first home warranty you come across is a bad idea. You have to compare the companies, their prices, all the systems and appliances they cover, and their annual coverage limits.

Another common mistake is skipping home inspection. It is important to hire a professional house inspector who can check basic things like the electrical system, water system, and other equipment. This inspection will allow homeowners to decide upon the right warranty plan as per their needs.

Last but not least, it’s important to read the warranty contract thoroughly. It sounds obvious but many people fail to understand the complicated terms and conditions contained in it. If you find it difficult, hire a professional who can explain everything in detail. It will only cost a few bucks but can save thousands in the future!

Did you know: Many people also fail to renew their home warranty plans. The reasons may differ but it’s best to research thoroughly and then decide if you wish to continue or not. We’ve put together a guide to help you choose whether you should renew your home warranty.


A home warranty plan is necessary to cover the cost of the household repairs, especially for people who buy old homes. While many people wonder “what is a home warranty plan?”, simple research can do wonders and can help save a lot of money in the long run.

A warranty plan covers all the basic equipment like an oven, air conditioning, and heater. If required, it can also include add-ons, e.g. swimming pools. We advise you to choose the best warranty plan according to your needs and avoid the common mistakes people make when purchasing one.


Does a home warranty cover plumbing?

Generally yes, a home warranty covers plumbing. The company may do a thorough checkup to ensure that there are no structural issues in the plumbing system of your house. However, they can deny plumbing coverage if old equipment is used in the house.

How much should I pay for a home warranty?

The average cost of a home warranty ranges anywhere between $300 and $600. It can vary depending upon the condition of the house, the state of the systems and appliances, and the add-ons you need.

Can you add a home warranty at any time?

Yes, you can add a home warranty any time of the year for any house. It doesn’t necessarily have to be during the purchase of a new home. A home warranty can be purchased at any time.

What does one year of home warranty cover?

People often ask exactly what does a home warranty cover, especially in the time span of a year. To be precise, it covers plumbing, water systems, the oven, microwave, heating systems, HVAC systems, etc. The exact coverage can be discussed with the warranty company.


I’m an entrepreneur by profession and an artist by passion. I do business to pay the bills and make music to bring the thrills. Thanks to a bachelor in Business Administration, I'm well-versed in all things business. Owning a construction company certainly helps, too, but it also brings out my love for building and home protection.

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