Home Warranty and Homeowners Insurance

Having a home is the most significant investment in one’s life. Furthermore, taking care of your home and property is crucial. Buying a home warranty and an insurance policy will do this for you. Purchasing these two will save you from unexpected expenses as these cover both appliances and systems in your house.

However, you must know the difference between homeowners insurance and a home warranty. Here is detail about both.

What is the difference between a home warranty and home insurance?

What is the difference between a home warranty and homeowners insurance is a commonly asked question. Home insurance and home warranty both work in the same way. Both home insurance and warranty are a yearly agreement. They both protect your budget from expenses of repair and replacement.

However, home insurance is somehow more costly than the home warranty. The significant difference between these two is their coverage, the appliances that they cover. The difference between homeowners insurance and a home warranty is that the insurance protects the home from natural disasters and emergencies, for example, fallen trees, fire, weather damage, or smoke.

In contrast, a home warranty protects the home appliances and installed systems by covering the cost of their repair or replacement. Home warranty saves money by covering the expenses of broken appliances. Homeowner warranty insurance is different from home insurance as insurance is required and to purchase a warranty is the homeowner’s choice.

What is home insurance?

Home insurance provides coverage for sudden or unexpected damage to homes and property because of fire, storm, wind, explosion, water overflow, rain, theft, and fires. Homeowners insurance usually provides 4 primary coverage inside and outside of the home, damage to property, any loss, or any disability due to injury, as it also includes medical expenses.

Generally, it is compulsory to obtain home insurance. Like homeowner warranty insurance, it is also renewed after a year. 

In case of damage to the property due to some natural disaster, the homeowner will call the insurance company and send him a check. 

If an appliance or an installed system of a home is broken due to normal wear and tear, home insurance will not cover its repair expenses. However, if this appliance or system, for instance, catches fire, then the home insurance will pay for its restoration.

What is a home warranty?

A home warranty is a yearly agreement that intends to cover and protect the appliances and systems installed in the home. A home warranty covers major appliances like plumbing, heating, electrical and cooling systems of the house. It provides coverage on the fridge, dishwasher, refrigerator, washing machine, and oven.

Homeowners can also select the appliances that they want to cover under the home warranty. Both homeowner warranty insurance and home insurance have the same purpose, but they are different. Homeowners make yearly payments to the home warranty company, somewhere between three hundred to six hundred dollars.

So that if any appliance breaks, the homeowners will not have to call a repairing service or spend money. They have to call the home warranty company, sending trusted and professional service providers to fix the appliance free of cost. Homeowners only have to pay the yearly payment of home insurance.

To answer the question, “what is the difference between a home warranty and home insurance is that, for instance, in the case of a leaking toilet, a home warranty will fix it but will not be responsible for other damages caused by the leakage. These damages will then be covered under home insurance.

The difference between homeowners insurance and home warranty coverage depends upon whether the damage to your appliances and home is caused by natural calamities or by normal wear and tear.

Anyhow it would be best if you had both a home warranty and insurance to protect your home. Homeowners’ warranty insurance will help you to get some relief from home expenses. Visit our article to know about the difference between homeowners insurance and a home warranty, which will help you buy a home warranty.