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How Much Does It Cost To Purchase A Home Warranty?

Typical Range: $213 - $1,447

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Home buyers looking for the best deals and the best levels of protection opt for a warranty that covers costs relating to the purchase of a new home. Often designed for first-time buyers, a warranty plan covers costs homeowners may incur after buying a home that they cannot pay for on their own.

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National Average
$813
Typical Range
$213 - $1,447
Low End - High End
$75 - $5,000

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Cost data is based on actual project costs as reported by 767 HomeAdvisor members in .

What Is a Home Warranty Plan?

A home warranty plan covers features of a home that an insurance plan won't cover. When an individual buys a plot of land and pays a construction company to build on that land, the construction company typically offers a warranty on the services provided. This warranty will protect homeowners from structural issues and other issues that arise from one year up to 10 years or longer. Those buying homes from previous owners or from real estate agents may not have that same protection, but there are companies that offer home warranties on existing homes.

How Does a Warranty Work?

Those who buy a home warranty plan will find that it covers issues not found during the home inspection process. Not only does it cover structural damage and roofing problems, but it may also cover the cost of appliances that new buyers bought from the existing seller. It usually covers the HVAC system, furnace and other things that came with the home. The new homeowners agree to pay a set price for protection, and the warranty company agrees to pay for repairs.

This doesn't mean that the warranty will cover all the costs of repairing or replacing something in the house. If the refrigerator dies, the company will send a repairman to the house to look at the problem. The homeowners usually need to pay a service fee, but the warranty provider should cover a larger portion of the repair cost. Warranty providers require that homeowners work with specific companies and often don't allow them to choose their own contractors or repairmen.

Home Warranty vs. Home Insurance

Many people tend to think that the only thing they need is a home insurance policy. They don't think about what insurance does and does not cover. Most insurance policies only cover issues relating to damage to the home. Those living in the Midwest often experience harsh winters that can cause pipes to freeze and bust inside the walls. An insurance company will pay for a repairman to come to the house and fix the problem without thinking about the other factors of the case. A broken pipe can cause water damage to the walls, lead to mold developing on the carpets and cause additional damage. A home warranty policy can cover the cost of all repairs needed on the home.

What a Warranty Doesn't Cover

A basic home warranty covers a wide range of items, including types of built-in appliances, the exhaust system and plumbing and electrical systems. A home warranty plan usually does not cover garage door openers, automatic garage door systems and air conditioners. Homeowners can purchase extended coverage that will pay for damage and repairs to those items. Most warranty companies offer multiple policies and levels of coverage. Many people add extra coverage that protects items usually not covered by these programs, including central vacuuming systems, swimming pools, wells and home spas.

Benefits of a Plan

Not having a home warranty plan is a common pitfall of first-time buyers. Though insurance may cover some of the problems and issues that homeowners face, a warranty plan combined with insurance covers nearly every potential problem. Many people find themselves buying a home and discovering hidden damage or other issues months after signing the deal. Even with a home inspection, homeowners may uncover some damage inside the walls or have problems with the appliances in the home.

Those buying brand-new homes often receive protection in the form of a guarantee or warranty by the contractor, building company or real estate agency, but those who buy older homes may not receive this warranty. Even a home as little as one year old may lack any type of guarantee. A home warranty plan lets shoppers get some protection for the future even if they are buying an older home.

Cost of a Warranty Plan

Those shopping for a home warranty plan need to consider both the cost of the premiums and the cost of the deductibles. Many companies offer plans that go into effect 30 days after the new owners sign the paperwork on a home. Most companies also charge a deductible that homeowners need to pay when the company provides service on the home. Homeowners will need to pay this amount every time they contact the company for help, and those smaller fees can add up over time, especially with frequent problems.

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How do we get this data?

  1. Homeowners visit HomeAdvisor.com to find a top-rated pro to complete their home improvement project or repair.

  2. Once their projects are completed, the members log in to their accounts and complete a short cost survey.

  3. After compiling and organizing the data, we report it back to you.