If you own an older home or your home’s appliances are no longer covered under a manufacturer’s warranty, there is a good chance you should look into purchasing a home warranty (also known as a home service contract) to get extra protection for your home’s systems and appliances. This guide will cover all of the basics of these contracts including coverage, costs, how they work, and reviews of the best home warranty companies.
Whether you are a homeowner, home buyer, landlord, or home seller, this guide will give you the tools to find the right coverage for your situation. If you’re already familiar with home warranties and just want to compare the best companies, below is a summary of our top overall recommendations:
Top Home Warranty Companies
|American Home Shield||First American||2-10 Home Buyers Warranty|
|Best For||Best Overall||Appliances||Builders|
|Learn More||Read Review||Read Review||Read Review|
Understanding Home Warranties
There are a lot of companies out there offering home warranties or home service contracts. Before committing to an annual contract with a company, it’s important to know exactly what is covered under the policy, how much it costs, and what level of coverage is right for you.
What Is a Home Warranty?
A home warranty is an annual contract that provides coverage for home systems and appliances, footing the bill for repairs and replacements due to normal wear-and-tear. Home warranties can cover household appliances like dishwashers and refrigerators, as well as home systems like HVAC, electrical, and plumbing.
Home warranties are not required for homeowners. However, they are an excellent choice for homeowners with older homes or appliances that are a few years old and no longer covered under a manufacturer’s warranty. It’s also helpful for homeowners who would not have the savings to cover an unexpected repair or replacement for a big-ticket appliance, such as a refrigerator. Many home warranty companies offer a variety of plans or add-ons to customize coverage to fit your needs.
How Do Home Warranties Work?
Home warranties follow a structure similar to insurance policies. The homeowner typically signs up for an annual contract and pays a monthly fee. In exchange for the fee, the home warranty company agrees to cover the cost of repairs and replacements for appliances and home systems as outlined in the contract.
When an appliance or home system fails, the homeowner files a claim with the home warranty company. The company confirms that the appliance or system is covered under the contract and assigns a service technician to diagnose and fix the problem. The homeowner will be responsible for an additional service fee for the visit (similar to an insurance deductible or a hospital copayment), and the rest of the costs of repair will be covered by the warranty, up to the specified limit listed in the contract. For items that cannot be fixed, the warranty company will either replace it or provide a lump-sum payment for the homeowner to replace it. Home service contracts are available only for appliances, only for systems, or for a combination of both (combo/hybrid plans).
Pros and Cons of Home Service Contracts
A home warranty is designed to provide homeowners with financial protection against unexpected repair bills for home appliances and systems. It is especially useful during the home selling/buying process, since there’s an asymmetry of information between buyers and sellers about the state of the home’s appliances and systems. Home sellers can offer a home service contract to encourage trust and increase the property’s value while buyers can rest assured that the contract would cover expenses associated with normal use. The ability to transfer ownership of a home warranty, such as from a seller to a buyer, is another major benefit.
Other benefits that most home warranty companies offer include 24/7 service and a quick process for filing claims for repairs. For people who aren’t handy and want their appliances and systems dealt with quickly, having someone else find a trained technician is a major plus.
Finally, since each home is unique, some companies offer customizable plans so that homeowners only pay for the coverage they need. For example, if a homeowner doesn’t have a dishwasher, they may be able to remove that coverage from the policy. And if they have a pool, they can include that as an add-on.
A major disadvantage of home warranties is that they don’t cover appliances or systems that haven’t been maintained. For example, if a home buyer purchases a home with older appliances that were not properly maintained by the previous owner, the contract may not cover repairs to these items. Some policies also have long lists of exclusions, and some repairs to your appliances or systems (including cosmetic defects) may not be covered.
Another drawback is that home service contracts also have benefit limits, which means they will only cover repairs and replacements for appliances and systems up to a certain amount (usually ranging between $500 and $3,500 depending on the company and the appliance or system in question). Any repairs or replacement costs that go above the limit amount are the responsibility of the homeowner. Some policies also enforce a total benefit limit for the contract term, such as $25,000 for all repairs and replacements. Before committing to a contract, it’s important to understand the benefit limits per item and ensure it would fit your needs.
In addition, most home warranty companies require that you use one of their in-network contractors to perform a service, or receive prior approval to work with a technician outside of their network. This could mean that if you are unhappy with the work that was performed by the in-network contractor, you won’t have the option to choose another one unless you want to pay out-of-pocket. In the event that your appliance or home system needs to be replaced, you also may not get to decide on the brand or model of the replacement.
Finally, homeowners may purchase a warranty contract and never need to use it (or won’t use it for many years). For homeowners who already have some savings that could be used in the event of an emergency, it might be more helpful for homeowners to put the money they would have spent on premiums into a specific fund for home improvement—and ultimately have a lot more say in the process of repairs and replacements, when necessary.
Types of Home Warranties
Home warranties are most often purchased by homeowners. However, different types of home service contracts are also available for home buyers, home sellers, and landlords. Furthermore, these contracts can be purchased for a single-family home, multi-family units, condos, and mobile homes. Here are a few of the different types of contracts available, as well as what they offer.
1. Homeowners Warranty
Most customers in the market for a home service contract will need a homeowners warranty. This is the best option for individuals who currently own or have mortgaged a home that they plan to stay in long-term. The homeowner is responsible for bearing the monthly fees, in exchange for coverage for repairs to appliances, home systems, or both. A homeowners warranty can be purchased at any time.
2. Home Buyers Warranty
A home buyers warranty is the way to go for individuals who are purchasing a home. Home buyers may not be fully aware of the state of all household appliances and systems in their new home, and they don’t want to be responsible for a nasty repair bill shortly after moving in. A home buyers warranty will cover the same types of repairs as a homeowners warranty. However, a home buyers warranty may be purchased by the buyer, the seller, or the realtor during the closing process. It goes into effect on the date of the closing.
3. Seller’s Home Warranty
For home sellers preparing to transfer ownership of a property, a seller’s home warranty offers peace of mind to the seller that unexpected repairs for appliances and systems won’t create additional costs prior to closing. A seller’s warranty can also be a selling point for prospective buyers, since they’ll know that any last-minute repairs would be covered. The warranty can also be transferred to the new buyer after closing.
4. Rental Property Home Warranty
Certain landlords would benefit from investing in a rental property home warranty in order to cover repairs associated with the rental. As with a homeowners warranty, a rental property home warranty could save thousands of dollars in unexpected repair costs, especially with older properties. Because tenants are not usually responsible for repairs to appliances and systems, renters don’t purchase these policies. Instead, renters might consider renters insurance, which covers personal property from damage and theft.
5. New Construction Home Warranty
A new construction home warranty includes coverage that not only handles wear and tear on systems, but also offers protection to ensure the quality of the construction itself. Even systems in newly-built properties might experience breakdowns. While most home service contracts last for one year and are renewable, new construction contracts are available for up to 10 or 20 years.
6. Condo Home Warranty
Since condos often share certain home systems, condo owners would need to purchase a condo home warranty rather than a typical homeowners warranty. Condo contracts cover appliances and systems that are specific to the covered condo unit, but may not cover systems (such as HVAC) that are shared across units. That’s why it’s important to read the fine print or choose a company that specializes in condo coverage.
7. Mobile Home Warranty
A mobile home warranty, sometimes called a manufactured home warranty, protects a mobile home’s systems and appliances due to damages from normal wear and tear. It operates the same way as a homeowners warranty, but may cover additional systems that are unique to mobile homes.
What Does a Home Warranty Cover?
A typical home service contract covers expenses for repairs to different systems and appliances within a home that occur due to usual wear-and-tear. Some systems and appliances are covered under most standard contracts, while others require add-ons.
Repairs for most kitchen and laundry appliances are covered under a home appliances warranty or a combo appliances/systems plan. The specifics of which damages are covered for each appliance varies by company, but most mechanical and electrical repairs would be included. In general, cosmetic changes such as dents and scratches are not covered. Furthermore, a few appliances require special coverage, or certain aspects of an item are uniquely not covered. These are some of the most common coverable appliances:
- Refrigerators: Refrigerators tend to last between 10 and 15 years. A few of the ways that a refrigerator could break down from wear and tear include a mechanically locked compressor or a broken fan motor. Note that not all companies will include refrigerators in their basic-level appliance plans so coverage may need to be purchased through a higher-tier option or as an add-on.
- Dishwashers: Dishwashers typically last around 10 years. Some of the failures that could be covered under a home warranty include the dishwasher’s pump, thermostat, thermal fuse, washer and spray arms, drain valve, motor assembly, door switch interlock, timer, and related electrical parts.
- Clothes Washers and Dryers: Laundry appliances, such as washers and dryers, are likely to last between eight and 10 years. A few of the repairs that are typically covered under warranty contracts include water level switches, water inlet valve, temperature switches, and motors.
- Ranges, Ovens, Cooktops, and Stoves: Ovens and cooktops usually last between 13 and 15 years. A home warranty will usually cover damages to features including the gas valve, burners, regulator, thermostat, igniter, fuse, heating elements, and internal wiring. It may not cover clocks, rotisseries, racks, handles, or knobs.
- Built-in Microwaves: A microwave can last up to 10 years, but could break down faster with more frequent usage. Most repairs to a microwave are included in standard contracts, though some exclusions may include doors, handles, clocks, or trays.
- Free-standing Ice Makers: Ice makers typically last between three and 10 years. Some components that may not be covered under a home service contract include filters, removable components that do not affect functionality, insulation, and refrigerant recapture.
- Trash Compactors: The lifespan of a trash compactor tends to be between seven and 11 years. A warranty with trash compactor coverage would pay for most repairs and expenses related to the functionality of the compactor, minus cosmetic defects.
- Garage Door Openers: Garage door openers typically last between 10 and 15 years. Most parts of a garage door opener are eligible for repair under standard contracts, though garage doors, hinges, and sensors may not be.
- Garbage Disposals: Garbage disposals are usually included in home warranty plans for appliances and systems. According to some service contracts, damages that may not be covered include those caused by bones, glass, or objects other than food.
- Stand-alone Freezers: Stand-alone freezers usually must be specifically added in order to be covered. While most electrical and mechanical issues would then be covered, individual components like shelves, knobs, door hinges, and door handles would typically not be.
2. Systems and Devices
In addition to the appliances used every day, home warranties are designed to cover the systems that power the home and make it comfortable. These broadly include HVAC, electrical systems, and plumbing. Here is a detailed list of some of the most common covered items under a system plan or combo appliance/systems plan.
- Air Conditioning Systems: Air conditioning systems are likely to last between 10 and 15 years. They might fail due to issues such as dirty coils, low refrigerant, or electrical problems. Air conditioning systems are almost always included in a systems plan or combo plan.
- Heating Systems: Most heating systems will last at least 10 years, and some could last far longer. Some issues that a heating system might encounter include a broken thermostat or broken blower motor. Heating systems are usually included in a systems plan or combo plan.
- Electrical Systems: Home warranties will typically cover electrical issues due to failures in wiring, switches and fuses, plugs, circuit breakers, and more. However, some of the components excluded are door bells, cables and wiring for computers/audio/video/intercom, smoke alarms, and damages due to power failures.
- Plumbing: Plumbing systems could fail due to leaks in the water, drain, waste or vent lines. They may also suffer from damage to toilet bowls, toilet tanks, and flushing mechanisms. While these issues are likely to be covered under most contracts, components such as fixtures (faucets and shower heads) as well as slab leaks and polybutylene pipes may not be.
- Water Heaters: Home warranties will often cover the cost of repairs to circulating pumps, thermostats, gas valves, and other components deemed essential to the function of a water heater. However, they may not cover holding or storage tanks, flues and vents, or solar water heaters.
- Instant Hot/Cold Water Dispensers: A contract with instant water dispenser coverage will cover most parts and components related to the device’s issues, but not all contracts offer this coverage. Some common issues with instant hot/cold water dispensers include the water not getting hot enough, the water getting too hot, or no water coming out at all.
- Central Vacuums: Central vacuums are subject to leaks, clogs, reduced suction, and broken motors or pipes. Home warranties will cover most parts and components for central vacuums, with the exception of removable hoses and accessories. They also usually won’t cover costs related to gaining and closing access to floors, walls, and ceilings when locating or repairing a malfunction.
- Smoke Detectors: Not all home service contracts cover smoke detectors, but those that do will perform repairs on either battery-operated or hard-wired units. A contract that includes smoke detectors will replace broken components and parts related to the functioning of the smoke detector.
- Doorbells: Doorbells are rarely included as part of a basic systems plan, but they can often be included as an optional add-on. Some of the issues a doorbell might have involve the button itself, the bell unit, the transformer, or the wiring in the circuit.
- Ceiling Fans: Systems plans will usually fix problems related to a ceiling fan’s motor, switches, controls, or bearings. The warranty may not cover damages related to the blades, or any lighting associated with the fan.
- Ductwork: A home warranty that covers home systems will provide coverage for ductwork from heating and/or cooling units to the connection point at a register or grill. Warranties will usually exclude improperly installed ductwork, or ductwork that has been exposed to outside elements.
- Sump Pumps: Sump pumps may be included as part of electrical coverage, or offered as an add-on, depending on the company. Sump pump coverage is designed to cover damages to permanently installed sump pumps for groundwater, when located within the foundation of a home or an attached garage.
3. Specialty Items
Furthermore, there are a few household systems and appliances that can be covered under a home warranty, but would need to be added on as an extra. These include:
- Pool and Spa Equipment: Home warranties can provide repairs for above-ground components of a pool related to the heating, pumping, and filtration systems. Cosmetic changes, lighting, cracks in a deck, and ornamental designs are not covered.
- Septic Systems: Policies with septic system coverage added on will cover repairs to the aerobic pump, sewage ejector, jet pump, and septic tank. However, coverage will exclude features such as leach lines, field lines, lateral lines, as well as clean outs and pumping.
- Well Pumps: Well pumps that are used as a source of water to the home can be included. Home warranties will generally cover components and parts for a well pump, with the exception of well casings, booster pumps, and pumps used for non-home purposes (such as irrigation or livestock).
- Second Appliances: Sometimes, homes have a second refrigerator, microwave, or other kitchen appliance. In order to have these secondary appliances covered, you would usually need to purchase an add-on, which would cover the same type of repairs as with the primary appliance.
- Roofs: Although rare, some companies will include roof leak coverage as an add-on. The coverage is often limited to repairs of a roof leak over the occupied living area, and may not cover gutters, patios, metal roofs, or shingles. Full or partial roof replacement is also not included in this coverage.
What Doesn’t a Home Warranty Cover?
In most cases, home service contracts do not cover appliances that have not been properly maintained, appliances that have failed before, and appliances that break due to an accident. A few companies will cover pre-existing conditions (broken parts, malfunctions, etc.) that were unknown, but this is rare. Most companies will not cover any pre-existing conditions, either known or unknown, and some require a home inspection in order to get coverage at all.
Home warranties also do not cover damages resulting from hazards such as weather, theft, vandalism, mold, or asbestos. Many of these items can be covered under homeowners insurance, which is a separate type of policy.
Furthermore, these contracts will not cover cosmetic defects, such as dents or scratches. You will also need to check your home warranty agreement to see if certain parts or components of an appliance are not covered. For example, some parts that are not essential to the functioning of a device—such as a shelf, a light, or a timer—may not be covered, either.
Home Warranties vs. Homeowners Insurance
Home warranties should not be confused with homeowners insurance. Homeowners insurance is designed to cover a home and personal belongings from damages caused by natural disasters, accidents, or theft, as outlined in an insurance policy. By contrast, a home warranty covers home appliances and systems that are damaged due to normal wear and tear, not external circumstances. Home insurance is usually mandatory in order to qualify for a mortgage, while a home service contract is optional and can be purchased at any time.
Home Warranty Cost
Home warranties can save you money if you end up with a costly repair to an appliance or home system. However, in exchange for coverage, the warranty company will charge a few different fees. When choosing a provider, it’s important to understand the fee structure, especially for monthly premiums and service fees.
How Much Does a Home Warranty Cost?
The total cost of a home warranty includes both monthly premiums and service fees. Monthly premiums usually run between $25–$60 per month, depending on the size of the residence and whether you choose to cover appliances, systems, or both. Furthermore, service call fees are typically $50–$125 per incident, depending on the company and the type of system or appliance that needs to be repaired.
The service fee will need to be paid once per incident that requires a technician to diagnose or fix a problem. So if the service fee is $75 and a technician visits twice in a year to run diagnostic tests (once to figure out a problem with the refrigerator and once to figure out a problem with the air conditioning unit), you would pay $150 in total for the service fees. If the issue is covered under your warranty and the repair/replacement costs do not exceed the policy’s benefit limit, you will not need to pay any additional fees (no matter how many days it takes the technician to fix the problem).
|Contract Type||Monthly Premium|
|Appliances and Systems (Basic)||$30–$60|
|Appliances and Systems (Premium)||$40–$75|
|Appliances and Systems, With Add-Ons||$100+|
Factors That Affect Cost
As with all warranties and types of insurance, home warranty plans vary from company to company. The total cost will usually depend on the number of appliances and systems covered under the warranty, as well as the size of the home. In general, larger homes (more than 5,000 square feet) have higher premiums, and smaller homes like condos and mobile homes may have lower premiums. Older homes (with older appliances) may also be subject to higher costs, although some companies do not factor a home’s age into their pricing structure. Add-on coverages, such as pool or hot tub coverage, will also incur an additional monthly premium.
Are Home Warranties Worth the Cost?
Home warranties can be worth the cost in some situations, but may not be worth it in others. Here are some factors to consider.
When a Contract May Be Worth It
For homeowners who do not have enough in savings to cover the cost of a repair to a critical appliance or system, such as the refrigerator or HVAC unit, a home service contract can provide financial peace of mind at a much lower price point. In addition, if you live in an older home or have older appliances that have outlasted their manufacturer’s warranty, these policies could save you from a large bill later.
For sellers, a warranty serves as a nice perk to give potential buyers the confidence that they won’t rack up massive bills for appliances and systems falling apart shortly after closing on the home. A home warranty is worth it if you are selling a home and having one increases the sale price by more than the cost of the policy.
Similarly, builders can offer buyers further protection and confidence with certain types of home warranties that cover several structural components of a newly built home.
Landlords may also benefit from a home service contract if they want financial protection for appliance and home system repairs at a fixed monthly cost. Landlords also might not care as much about the lack of flexibility in choosing specific replacement items, which can be a sticking point for homeowners.
When a Contract May Not Be Worth It
Home warranties may be less desirable for homeowners who have entirely new appliances, or appliances that are still covered under a manufacturer’s guarantee. If you aren’t the type of person that keeps detailed maintenance records, or if you purchased a home in which the appliances were not well-maintained, such contracts may not cover repairs and therefore might not be worth the cost.
Individuals who also have enough in savings to cover an unexpected repair cost may also be willing to take that risk in order to save money on the monthly premiums associated with the policy. In this case, the money that would be spent on monthly premiums could be better used in a savings account for emergency repairs, since it would also earn interest.
Finally, individuals who want the flexibility of selecting their own service technicians and replacement items could be better off without a home warranty. Before making a decision one way or the other, it helps to review your financial situation, take stock of the current state of your home’s systems and appliances, and research some of the best home warranty companies to see if any of their policies fit your needs.
How to Compare Home Warranty Companies
Coverage and Benefit Limits
The most important point in comparing companies is to understand the level of coverage for each plan. Most companies will offer a plan just for systems, one for appliances, and one that covers both (often known as a combo or hybrid plan). Others may offer plans that cover both appliances and systems, but have different levels of coverage for a variety of prices. It’s important to have a detailed breakdown of covered systems, covered appliances, and specialty coverage (if applicable) to make sure the company suits your needs. Some companies also give you the option to build your own plan or purchase optional add-ons, based on the appliances and systems for which you need coverage.
In addition to what is covered, home warranty companies should also explicitly list their exclusions, whether they be specific types of systems and appliances, certain parts, or certain events (e.g. accidents, improper maintenance, etc.). Most companies exclude roof leaks by default, so if you live in an area with a lot of rain, research companies that offer roof leak coverage as an add-on.
Since repairs for appliances and systems can run a hefty bill, it’s also worth looking at the benefit limit. For example, if a home service contract offers up to $1,500 to replace a refrigerator but it would cost much more than that, another company with higher benefit limits might be a better choice. You would also need to know if the benefit limit is for each item/incident or for the entire plan year.
Finally, the company must offer coverage within your state. Not all home warranty companies operate in all states, so you’ll want to choose one with offices and contractor networks located close to you.
If a home warranty company offers your desired level of coverage, then it’s time to research their reputation among customers and the industry. For example, reputable companies will likely have a membership with the National Home Service Contract Association (NHSCA).
Some companies also take a lot of pride in having a long history in the industry. Some will list on their website the number of customers they’ve served, the number of employees they have, and the year they were founded. While smaller and newer companies can still offer stellar service, larger and more established companies may have a broader network of service technicians and also more resources to respond to customer inquiries.
Ultimately, customer satisfaction is what matters the most when it comes to company reputation. A good place to learn more about a home warranty company’s reputation among customers is the Better Business Bureau (BBB). The BBB website offers opportunities for customers to share their complaints, which the companies have the opportunity to respond to, as well. Some home warranty companies will also have a rating on Angie’s List, based on customer reviews. Angie’s List is particularly helpful for finding reviews specific to companies offering home service contracts within your zip code. When combined, the BBB and Angie’s list offer a snapshot of the general sentiment around the company.
Some companies will also list awards and recognitions on their website. At face value, these might seem like good testimonials about their product. However, it helps to dig deeper into these awards to see how many contenders there were and how they were selected.
Service and Claims
If you have an appliance or system that breaks down, you’ll want to know how quickly the company can assist you. When researching home warranty companies, ask about the waiting period, which is the period of time after signing the contract that you would need to wait before placing a service request. Most companies require a 30-day waiting period and will not cover items that break during that time.
Other questions to ask about service and claims include if the company offers 24/7 service requests. For example, if there’s a plumbing issue at 3:00 A.M., can you submit a claim right away and get the help you need? In addition, it helps to understand how many service technicians are available under your contract. Inquire as to whether the company only works with in-network technicians and how many there are in the network.
You will also need to understand the terms of service as outlined in your contract. Specifically, look for a recall period, or service guarantee period, to ensure that you will be satisfied with the service or have the option for a second opinion or another service visit.
There are several costs associated with a home warranty, including the monthly premiums and service fees. When comparing companies, look at the range of service fees that you would have to pay for each visit, in addition to how much you would have to pay per month in monthly premiums. If you live in an older home and expect that more of your appliances may need repair, it may be worth it to go with a slightly higher monthly premium and lower service fees. If the appliances and systems in your home appear to be in good condition and you just want peace of mind, you may opt for a company that charges lower premiums but higher service fees.
As part of getting a home service contract, you will be required to sign an agreement. Some important factors to consider are contract length and cancellation policy. Most home warranties last for one year, with option for renewal, although some types can last longer. Some companies will allow you to terminate your contract at any time, while others have restrictions for cancellation, including cancellation fees. You may also wish to check if a home inspection is required as part of the contract.
Finally, transparency is always important when it comes to signing up for a new contract. Companies that offer an online quote or application up front are trying to make it easier for customers to determine the cost of a warranty that fits their needs. In addition, the best home warranty companies will have a sample contract easily accessible on their website so that customers can understand the terms and conditions right away.
Best Home Warranty Companies
American Home Shield (Best Overall)
Available in all states except Alaska, American Home Shield (AHS) is best known for its customizable plans. In addition to offering an appliances plan, a systems plan, and a combo plan, customers also have the option to build their own plan based only on the coverage they need. The appliances plan covers 10 appliances, including refrigerators, washers, dryers, ovens, and cooktops. The systems plan covers 11 major home systems, including plumbing, HVAC, and electrical. The combo plan covers the 10 appliances and 11 home systems, while a build-your-own plan covers 10 appliances and systems of your choice.
Like most home warranty companies, there are optional add-ons available. AHS offers add-on coverage for pools, spas, well pumps, septic pumps, and more. However, AHS does not offer roof leak coverage. For specialty coverage, AHS offers an Electronics Plan, which serves as an extended policy for the repair or replacement of electronics such as televisions, computers, smart home products, gaming systems, and home theaters. Electronics coverage is rare for home warranty companies, so homeowners with many “smart home” products may benefit from a policy with AHS.
AHS covers damages due to normal wear and tear on appliances, but does also list some exclusions. These include routine maintenance, cosmetic defects, chimneys and exhaust lines, damages due to mold or mildew, and when a malfunction is due to missing components. AHS will also not cover repairs for appliances that are already covered under a manufacturer, distributor, builder, or an extended warranty.
For appliances, the coverage limit is up to $3,000 per item. Plumbing services have a limit up to $1,000 per contract term, and well pumps are up to $1,500 per contract term. There is no coverage limit for air conditioning and heating units, and no limit listed for all other systems. Furthermore, there is no limit on the number of service claims that a customer can file over the course of the contract term.
American Home Shield is a member of the NHSCA. Founded in 1971, AHS also holds the distinction of being one of the oldest home service contract companies in the U.S. The company has 1,600 employees nationwide and has served 1.7 million customers. The company holds a B rating with the Better Business Bureau, and it is ranked among the “Best Overall” home warranty companies by Consumer Affairs.
Service and Claims
After purchasing a home service contract with American Home Shield, customers have a 30-day waiting period before making service requests. AHS offers 24/7 service requests, with a contractor network of 16,000 service technicians. AHS will assign the contractor who performs the service, although customers may request an outside contractor to be authorized to perform the service. Service claims and payment fees are managed through an online portal. Each service visit has a 60-day recall period to guarantee that the work was performed satisfactorily.
The cost of a home warranty through AHS varies, based on the level of coverage and service fee chosen. The service fees are either $75, $100, or $125. The higher the service fee, the lower the monthly premium. To receive the most accurate pricing information, AHS recommends requesting a quote.
The standard contract length at AHS is one year, and no home inspection is required. The customer may cancel the contract at any time and for any reason, but would need to cancel within the first 30 days to receive a full refund, minus any service fees incurred.
Homeowners can request a quote for a home warranty directly on the AHS website. The AHS website also shares a sample contract, but reminds customers that contracts and coverage will vary from state to state.
First American Home Warranty (Best for Appliances)
First American Home Warranty operates in 36 states, including California, Florida, and Texas. The company keeps its offerings simple, with two plans to choose from: Basic or Premier. The Basic Plan covers essential appliances, including refrigerators, washers, dryers, ovens, cooktops and more. The Premier Plan covers everything in the Basic Plan, as well home systems like heaters, plumbing, electrical, water heaters, and more. Homeowners can also request add-ons, such as air conditioning units with ductwork, a pool & spa, well pumps, and a second refrigerator. The company does not offer roof leak coverage. However, they do also offer a First Class Upgrade, which includes limited upgrades required by building codes, disposal of replaced appliances, and fixes for improper installations completed prior to the coverage period.
Unlike most companies, First American covers preexisting conditions, as well as issues due to rust, corrosion, and sediment. However, they do not cover expenses that are not explicitly listed in the contract. These include structural modifications and cosmetic changes.
There is no limit to how many service requests you can make in a contract term. In addition, First American has a generous benefit limit on appliances, at $3,500 per appliance. The limit on home systems tends to be lower, ranging from $500 to $1,500 per year.
First American Home Warranty was founded in 1984, making it one of the most established companies in the industry. The company is also a member of NHSCA. First American has a B+ rating with the BBB, and they won the Annual Home Warranty Editor’s Choice Award. According to its website, the company has served more than 590,000 customers and employs more than 850 associates in its three major offices.
Service and Claims
The waiting period for First American is 30 days, the industry standard. According to its website, First American has a network of thousands of independent contractors to handle service requests. The company offers 24/7 access to service requests.
The premium for the Basic Plan is about $28 per month, making it one of the lowest-cost in the industry. The Premier Plan is about $45 a month. Service fees range from $75 to $100.
First American has a sample contract readily available online. Contract terms last for one year, and no home inspection is required. To determine if First American serves your area, you can request a quote directly on their website. Should you choose to cancel, in most states you would be entitled to a prorated refund, minus a $50 administrative fee and any service costs incurred.
2-10 Home Buyers Warranty (Best for Builders)
2-10 Home Buyers Warranty offers coverage in 42 states, excluding Hawaii, Alaska, Montana, New Hampshire, North Dakota, Wisconsin, Oklahoma, and Wyoming. As suggested in its name, 2-10 HBW is an excellent choice for home buyers and sellers, as well as homeowners.
2-10 HBW offers three plans for homeowners to choose from. The first is the HVAC + Water Heater plan, which is a systems plan that includes the central heating system, thermostats, gas lines, codes, permits & modification, central refrigeration systems, heat pumps, evaporative coolers, ductwork, and water heater. The second is the Major Appliances plan, which includes the refrigerator with ice maker, dishwasher, stove/oven/range, built-in microwave, trash compactor, and garbage disposal. The third is the Everything Together plan, which combines the benefits of the Major Appliances Plan and HVAC + Water Heater Plan, along with extras such as pipe leaks, toilets, tubs & showers, fixtures & valves, wiring, switches & outlets, central vacuums, doorbells, garage door openers, and lighting fixtures. Add-on coverages for these plans include additional refrigerators, stand-alone freezers, roof leaks, septic systems, pool/spa equipment, and well pumps.
The total liability limit for all claims throughout the contract term is capped at $25,000. In addition, there are individual item limits outlined in the contract, so it’s important to read carefully. 2-10 HBW may only include pre-existing conditions if they were unknown. The contract also won’t cover cosmetic defects, damages due to misuse, and some item components deemed non-essential for the item to function.
For real estate transactions, 2-10 HBW also offers Seller Coverage and Buyer Coverage, which cover major appliances, HVAC, water heater, electrical, plumbing, and more. Finally, the most unique coverage for 2-10 HBW is its Structural Warranty, which is available for builders of new homes and covers workmanship, distribution systems, and structural defects.
2-10 HBW was founded in 1983, and has about 600 employees nationwide. The company prides itself on having covered more than 6 million homes. 2-10 Home Buyers Warranty is a member of the NHSCA, and also a member of the National Association of Home Builders (NAHB). The company is accredited with the Better Business Bureau and has earned an A rating.
Service and Claims
After signing up for a new home service contract, there is a 30-day waiting period. However, after that period expires, customers have access to 24/7 service requests, which can be submitted on the 2-10 HBW website. The 2-10 Home Buyers Warranty contractor network numbers 6,000 licensed service technicians. If, for some reason, a 2-10 contractor is not available, you may choose your own technician to review the issue and receive authorization from 2-10 HBW to fix the problem.
The cost of the monthly premium for a homeowners policy depends on the level of coverage selected, but starts as low as $37 per month. A quote would be required to determine the exact monthly premium for your coverage. Service fees for 2-10 HBW range from $85 to $125.
The contract length for a systems and appliances plan is one year. For a structural plan, 2-10 HBW offers two years of warranty coverage for major systems and 10 years of coverage for all structural defects. Interested customers can request a quote online to find coverage and costs in their area. No home inspection is required. Cancellation incurs a $25 processing fee, but you would receive a full refund minus this fee if you cancel within 30 days.
Amazon Home Warranty (Best for Rental Properties)
Amazon Home Warranty (AHW) offers coverage in 42 states, excluding California, Iowa, Maine, Minnesota, New Mexico, Oklahoma, Utah, and Washington. The company offers three plans: the appliance plan (which covers eight major kitchen and laundry appliances), the system plan (which covers eight major plumbing, HVAC, and electrical home systems), and the combo plan (which covers everything in the appliance and system plans, plus extras like ceiling fans, doorbells, and garbage disposals). AHW’s add-on coverages include pool & spa equipment, well pumps, septic systems, and stand-alone freezers. AHW also offers limited roof leak coverage as an add-on.
Like all home warranty companies, AHW coverage comes with exclusions. Specifically, AHW does not cover plumbing issues that require access through the home’s foundation or slab. It also doesn’t cover pre-existing conditions, cosmetic defects, routine maintenance, or damage caused by rust and corrosion. AHW will only cover appliances and systems that are not covered under any other type of insurance or warranty.
For most systems and appliances, AHW has a $1,500 limit per claim with no annual benefit limit. An exception is the air conditioning system, which has a limit of $2,500. In addition, systems and appliances with a limit of $500 include ceiling and exhaust fans, electrical systems, encased ductwork, plumbing systems, water heaters, and whirlpool bathtubs.
Contrary to popular belief, Amazon Home Warranty is not affiliated with e-commerce giant Amazon.com. However, it still has a strong reputation within the industry. Founded in 2010, AHW has earned an A+ rating with the BBB, and it boasts hundreds of five star reviews from customers on the BBB website. AHW is not a member of the NHSCA.
Service and Claims
AHW has over 40,000 in-network service providers nationwide, and customers may also use an out-of-network provider if they receive prior authorization. Service requests can be submitted 24/7 by calling their toll-free number. However, there is a 30-day waiting period before customers can submit service requests.
One of the unique features about Amazon Home Warranty is that it allows customers to request a second opinion if the first service technician says an appliance or system malfunction isn’t covered under the warranty. This is particularly helpful for landlords who are unable to visit their rental property in person to verify the first technician’s assessment. In addition, AHW has a generous service recall period: 90 days for parts and 30 days for labor.
With AHW, the service fee per visit is $75, which is in line with the industry standard. The monthly premiums would depend on which plan you choose, as well as where you live. In general, you can expect to pay between $30–$50 per month for premiums with AHW. AHW will frequently run discounts and promotions, such as $75 off and the first month free, making it a budget-friendly choice for new customers.
AHW provides a sample contract on its website. A standard contract with AHW lasts for one year, which includes the 30-day waiting period. A home inspection is not required for customers to enroll. In addition to outlining coverage and limits, the contract explains the cancellation policy. A customer can cancel the contract at any time, but would need to do so within the first 30 days to receive a full refund (some additional criteria may apply for certain states). Customers are encouraged to request a quote online to understand their costs and the full terms of their specific contract.
Choice Home Warranty (Best for Condos & Mobile Homes)
Choice Home Warranty (CHW) offers coverage in 47 states, excluding California, Oklahoma, and Wisconsin. Rather than segment coverage into systems and/or appliances, the company offers only two types of plans: the Basic Plan and the Total Plan. The basic plan includes the heating system, electrical system, plumbing system/stoppage, water heater, whirlpool bathtub, oven/range/stove, cooktop, dishwasher, microwave, garbage disposal, ductwork, garage door opener, and ceiling/exhaust fans. The total plan includes everything in the basic plan as well as the washer/dryer, refrigerator, and air conditioning system. For homeowners seeking add-ons, Choice Home Warranty offers coverage for pool/spa equipment, well pumps, sump pumps, central vacuums, limited roof leaks, septic systems, stand-alone freezers, and more.
While some companies only offer coverage for single-family homes, Choice provides service contracts for single-family homes, condos, and mobile/manufactured homes.
Like most companies, Choice Home Warranty does not cover pre-existing conditions (known or unknown), cosmetic defects, misuse of appliances, or certain components of items as outlined in the user agreement. Customers can review the full list of exclusions in the user agreement.
Most items covered in the service agreement are subject to a $1,500 limit. However, some systems such as ductwork, plumbing, and electrical systems have a limit of $500.
Choice Home Warranty was founded in 2008 in Edison, NJ. It currently holds a B- rating with the BBB. Choice Home Warranty is not a NHSCA member. However, the company has covered more than 1,000,000 homes nationwide and is one of the larger players in the industry due to its extensive coverage options across most of the country.
Service and Claims
Coverage begins after the initial 30-day waiting period. Once service is available, customers benefit from the 15,000 contractors in the Choice Home Warranty network. Service requests can be submitted 24/7, and the recall period is 30 days on labor and 90 days on parts. In addition, the company assigns two or three customer service representatives to every claim in order to further ensure customer satisfaction.
Choice Home Warranty has some of the lowest fees around. Premiums come in around $36–$44 per month, depending on the plan and location, while service fees range from $60 to $85. As an added incentive, CHW offers the first month of the contract free of charge.
The CHW website shares a sample user agreement. The contract term is one year, and no home inspection is required to sign up. If you wish to cancel, CHW charges a $50 cancellation fee, no matter when cancellation occurs. However, you will receive a full refund minus this fee if you cancel within the first 30 days of the contract. To find the specific costs and coverage for your location and home, you can request a quote on the Choice Home Warranty website.
Landmark Home Warranty (Regional Coverage)
Landmark Home Warranty is one of the best options for its areas of coverage: Arizona, Idaho, Nevada, Oregon, Texas and Utah. The company offers two types of plans: the Home Systems Plan and the Total Protection Plan. The Home Systems Plan covers air conditioning, heating, electrical systems, plumbing, pest control, and termite treatment. The Total Protection Plan includes everything in the Home Systems Plan, as well as appliances including the microwave, central vacuum, dishwasher, garbage disposal, kitchen refrigerator, oven/range/cooktop, and washer/dryer. You can also purchase additional coverage for systems and appliances such as well pumps, freestanding ice makers, stand-alone freezers, pools, hot tubs, and septic systems. Roof leak repair is also available.
Unlike many other companies, Landmark offers no-fault coverage, which covers systems and appliances that malfunction due to improper installation. However, the company does also have a number of exclusions, which are outlined in the contract. These include damages due to freezing, fire, or an “act of God.” Some repairs to items or appliances may not be covered either, such as knobs, rollers, and interior linings.
There is no aggregate limit to the home service contract, but there are caps for individual appliances and systems. These will be outlined in the contract, but typically range from $500 to $1,500 per item.
Since its founding in 2004, Landmark has been a well-respected regional home warranty company. The company currently has more than 70,000 customers and 200 full-time employees. The company has a B rating with the BBB, and it is an active member of the NHSCA.
Service and Claims
Landmark Home Warranty requires a 30-day waiting period before coverage begins. There is also a 30-day service recall period, which is shorter than some of the other companies reviewed in this guide. However, service requests can be submitted 24/7, and Landmark offers a sizable network of licensed service technicians.
Monthly premiums for Landmark tend to be about $35 for a Home Systems Plan or $55 for a Total Protection Plan. The service call fee is $60, $70, or $100, depending on the plan and location.
Landmark’s website shares a resource for how to understand your home warranty contract.
The standard contract lasts for one year, the industry standard. For homeowners who wish to cancel their policy, there is a $75 cancellation fee. Homeowners can request a quote or sign up directly on the Landmark website.
Select Home Warranty (Best for Roof Coverage)
Select Home Warranty is available in almost every state, and they offer coverage for a variety of properties, including rentals, mobile homes, manufactured homes, single family homes, multiple-family units, and condos.
Select offers three home warranty plans: Bronze Care (appliances), Gold Care (systems), and Platinum Care (both systems and appliances). The Platinum Care plan covers the HVAC system, electrical system, water heater, plumbing, refrigerator, stove/oven/cooktop, microwave, dishwasher, washer/dryer, and more. For all three plans, Select also offers roof coverage, which is rare.
Like most companies, Select offers add-ons for pool and spa equipment, well pumps, sump pumps, septic systems, ice makers, and stand-alone freezers.
Select Home Warranty has no total claim maximum, but there are “per item” benefit limits that will be outlined in the service contract. Similarly, exclusions from coverage will be listed in the contract and would include things like cosmetic defects, damages from acts of nature, as well as certain non-essential components of an otherwise covered item.
A relative newcomer to the industry, Select Home Warranty was founded in 2012 and holds a B- rating with the BBB. It is not currently an NHSCA member.
Service and Claims
Like most home warranty companies, Select requires a waiting period of 30 days before customers can submit a service request. However, one of the major advantages of Select is its extensive network of 10,000 technicians to service claims. Warranty holders can also submit service requests 24/7. Select offers a service recall period of 90 days.
To receive the most accurate pricing information, Select recommends requesting a custom quote. In general, you can expect to pay between $36 and $75 per month for Select, depending on the plan. The service fee is about $60, lower than the industry standard. Select frequently offers promotions, such as $100 off and 2 free months, making it an attractive option for new customers.
Select makes it easy to request a quote online, and no home inspection is needed in order to apply. The contract term is one year, although the contract can be cancelled at any time by the homeowner for a $75 fee. Full refunds, minus service fees, are provided if the contract is cancelled within 30 days, otherwise a pro-rated refund is provided. Select’s website also shares its general terms and conditions, but it’s always a good idea to review your specific contract before signing on the dotted line.
List of Home Warranty Companies
|Company||Best For||Monthly Premium||Service Fee||Highlights|
|Choice||Condos and Mobile Homes||$30–$37||$85||Coverage in 47 states, excluding California, Oklahoma, and Wisconsin; Offers two types of plans: the Basic Plan and the Total Plan; Offers service recall period within 90 days of service|
|First American||Appliances||$25–$40||$75–$100||Coverage in 36 states; Two plans to choose from: Basic or Premier, also an option for a First-Class Upgrade; No overall benefit limit, and generous per-item limit for appliances|
|Home Warranty of America||Sellers||Varies||$60–$100||Coverage in all 50 states; Offers two plans: Premier and Premier Plus; Offers 13-month warranty period, rather than standard 12-month|
|Old Republic||Home Buyers and Sellers||Varies||$75–$100||Coverage in 27 states and Washington, D.C.; Website offers comprehensive brochures detailing coverage and prices for each state|
|Fidelity||Low-cost coverage||Starts at $30||$75||Coverage in 17 states; Standard plan doesn’t include appliances such as the kitchen refrigerator or washer/dryer|
|Cinch Home Services||Homeowners||$28–$40||$125||Coverage in 48 states and Washington, D.C.; Offers three plans: Appliances, Built-in Systems, and Complete Home|
|HSA Home Warranty||Home Buyers and Sellers||$37–$57||$100–$125||Coverage available in 26 states and Washington, D.C.; Offers three plans: Basic Plan Seller, Basic Plan Buyer, and Buyer 7 Star Upgrade; Can only purchase coverage when buying or selling a home|
|Sears Home Warranty||Service Recalls||$50–$70||$75–$100||Coverage available in 49 states; Offers three plans: Appliance, System, or Whole House; 180-day guarantee on covered repairs|
|Landmark||Regional Coverage: West||$35–55||$60–$70||Coverage available in 6 states (Arizona, Idaho, Nevada, Oregon, Texas, and Utah); Offers two plan options: a Home System plan and a Total Protection plan; Also offers pest control and termite treatment|
|America’s Preferred Home Warranty||Nationwide Coverage||Varies||$50, $100, or $125||Coverage available in 50 states; Offers two plans that cover both appliances and systems: Standard Coverage and Preferred Upgrade Plan; Further add-ons are also available; Provides roof leak coverage|
|Super Home Warranty||Preventative Coverage||Varies||$75||Coverage available in 4 states (Arizona, Maryland, Texas, and Illinois), and Washington D.C.; Subscription-based model to cover breakdowns, preventative care, and other home services; Offers three plan levels that cover home systems and appliances: Secure, Signature, and Lux; Covers pre-existing conditions|
|Select||Roof Leak Coverage||$35–$42||$60||Coverage available in 45 states; Offers three tiers of plans: Bronze, Gold, and Platinum; 10,000 local contractors; Free roof coverage|
|2-10 Home Buyers Warranty||Builders||$30–$40||$85–$125||Coverage available in 48 states; Offers structural warranties for new homes; Offers three plans: Standard, Supreme, and Seller plan; Network of 6,000 service contractors|
|OneGuard||Regional Coverage: Southwest||$25–$56||$69||Coverage available in 3 states (Arizona, Nevada and Texas); Offers three plans: ApplianceGuard, SystemGuard, andHomeGuard (covers both appliances and systems)|
|Total Protect||Service Recall Period||Varies||$75, $100, or $125||Coverage available in 50 states; Offers appliances plan, systems plan, and combo plan; 40,000 screened service providers around the country; 180-day guarantee on all service work|
|Blue Ribbon||Regional Coverage: Colorado||$23–67||$55||Coverage available in 1 state (Colorado); Offers three levels of coverage (Silver, Gold, and Platinum); 14-month service contract|
|Home Warranty Inc.||Homeowners||Starts at $45||$75, except for Appliance Protection Plan ($0)||Coverage available in 30 states; Offers three homeowner home warranty plans: Home Protection Plan, Appliance Protection Plan (build your own), and Supplemental Home Protection Plan; 14-month service contract|
|Costco Home Warranty||Extended Appliance Warranties||Varies||None||Coverage in 49 states; Available only to Costco members; Offer three types of warranty plans: appliances, kitchen suite and laundry suite; Each plan lasts for a total of 5 years; No coverage available for home systems|
|Elevate Home Warranty||Regional Coverage: Utah||$25–$44||$59||Coverage in 1 state (Utah); Four tiers of plans available, as well as optional add-ons; Covers systems and appliances with undetectable pre-existing conditions|
|American Home Shield||Homeowners||Varies||$75, $100, or $125||Coverage in 49 states; Highly customizable plan options available, in addition to appliance, systems, or combo plan; Contractor network of 15,000 professionals|
|UHP||Regional Coverage: Midwest||Varies||$40–$56||Coverage in 2 states (Wisconsin and Illinois); Three tiers of plans available|
|Amazon Home Warranty (AHW)||Rental Properties||$30–$50||$75||Coverage in 42 states and Washington, D.C.; Plans available for appliances, systems, or both; Add-ons also available; Nationwide network of more than 40,000 contractors|
|Platinum Home Warranty||Regional Coverage: Arizona||$37–$106+||$75||Coverage in 1 state (Arizona); Tiered plans available for single-family homes, mobile homes, condos, townhomes, duplexes, triplexes, and fourplexes|
|Fixd Home Warranty||Low Service Fees||$30–$89||$50||Coverage in 2 states (Texas and Georgia); Tiered plans available for condos, homes, and mansions; Relatively new company, founded in 2014|
FAQs About Home Service Contracts
Are home warranty companies regulated?
Home warranty companies are regulated in all 50 states through consumer protection laws. According to Angie’s List, 32 states specifically require home warranty companies to be registered or licensed through the state’s insurance department. Texas requires these companies (which they also refer to as residential service companies) to be licensed by the Texas Real Estate Commission. Likewise, Section 634.303 of the Florida Statutes claims that such companies must operate under a license, which is renewable every year. Home warranty companies in California must also seek licensure through the state’s department of insurance.
Should you renew your home warranty?
Homeowners who purchased a home service contract for their first year in their home, or inherited the contract from the seller, may be wondering if it’s worth it to renew. If your appliances are older and no longer covered by a manufacturer’s warranty, or if you don’t have the cash on hand to pay for an expensive repair, then it is probably worth renewing. However, you’ll need to read the fine print in the contract to make sure that the appliances and systems that you want protection for are covered.
When should you cancel your home warranty?
If you wish to cancel your home service contract, you should do so either within the first 30 days of the contract (the timeframe that most companies allow customers to cancel and receive full refunds) or immediately before the contract is up for renewal. If you cancel your home warranty outside of these two time periods, you will likely need to pay a cancellation fee and will only receive a partial refund or no refund at all.
Is there a deductible for a home warranty?
Insurance companies are known for having deductibles as cost-sharing measures between a policyholder and the insurer. The home warranty service fee serves the same function as a deductible, in which the homeowner must pay a set amount (usually $50–$125 per service visit) before the contract kicks in to cover the rest of the repair cost.