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Home Appliance Warranties: Are They Worth It?
When purchasing a new home appliance, one of the decisions you’ll face is whether to invest in a warranty. While warranties can offer peace of mind, they also come with costs and conditions that may not always justify the expense. Here’s a closer look at the pros and cons of home appliance warranties to help you decide if they’re right for you.
A home appliance warranty is a service contract that covers the repair or replacement of home appliances in case of failure or malfunction due to normal wear and tear. These warranties can be offered by the manufacturer, the retailer, or third-party companies, and they typically last from one to several years.
1. Peace of Mind
One of the biggest advantages of a warranty is the reassurance it provides. Knowing that your appliance is covered in case of unexpected repairs can relieve financial stress.
2. Cost Savings on Repairs
Appliances can be expensive to repair. A warranty can potentially save you money if a major appliance fails after the manufacturer’s warranty has expired. Depending on the coverage, you might only need to pay a deductible.
3. Convenience of Service
Warranties often come with the convenience of quick service. Many providers will send a technician to your home to assess and repair the appliance, which can save you time and hassle.
4. Coverage for Multiple Appliances
Some warranties cover multiple appliances under a single plan, providing comprehensive protection for your home. This can be especially beneficial for new homeowners who have invested in several major appliances.
1. Cost vs. Benefit
Warranties can be pricey, often costing hundreds of dollars for coverage that may not be needed. Many people find that the cost of potential repairs is less than the price of the warranty itself.
2. Limited Coverage
Not all issues may be covered under a warranty. Many contracts have exclusions for specific types of damage or wear, and you might still be responsible for certain repair costs.
3. Service Quality Variability
The quality of service can vary widely among warranty providers. Some companies may have a reputation for long wait times or subpar repair work, which can lead to frustration.
4. Complex Claims Process
Filing a claim can sometimes be cumbersome. You might face a lengthy process to get approval for repairs, which can be inconvenient if your appliance is essential for daily use.
Factors to Consider
When deciding whether to purchase a warranty, consider the following:
- Age and Reliability of Appliances: Newer models from reputable brands may be less likely to fail, making a warranty less necessary.
- Cost of Repairs: Research potential repair costs for your specific appliances. If they are known for being reliable and inexpensive to fix, a warranty might not be worth it.
- Financial Situation: Consider your budget and whether you’d prefer to pay for repairs as they come or have a lump sum payment for a warranty.
- Manufacturer’s Warranty: Many appliances come with a manufacturer’s warranty, typically lasting one year. Evaluate whether extending coverage is necessary after this period.
Home appliance warranties can offer valuable protection and peace of mind, but they are not a one-size-fits-all solution. Carefully evaluate the costs, coverage details, and the reliability of your appliances before making a decision. In some cases, you might find that saving for potential repairs or investing in high-quality appliances is a more cost-effective approach. Ultimately, understanding your specific needs and circumstances will guide you in making the right cho
What Is a Home Warranty, and Why Do You Need One?
A home warranty is a renewable home service plan that offers discounted repair and replacement services for applicable household appliances and systems. Contracts and terms may vary, and coverage depends on the type of warranty you purchase. It does not provide the same coverage as homeowners insurance, which protects policyholders against damage to personal property and the home’s structure, such as fire damage or theft.
A home warranty can be an excellent option to protect your home investment. When coupled with a good homeowners insurance policy, you can have most of your bases covered. However, if you purchased a new home, many house systems are covered by manufacturer warranties.
The same is true for new appliances. Before you take the plunge and buy a home warranty, make sure your systems aren’t already covered first.
How To Choose A Home Warranty Company
It’s important to select a home warranty company that fits your needs, lifestyle, family and home. Before choosing a company, consider the following factors to make sure the home warranty plan you choose will be worth it.
Your Coverage Needs
Depending on your home, appliances and systems, you may only need a basic plan that covers the big necessities or a more comprehensive plan. To determine the type of plan that you need, take stock of your appliances and systems and focus on getting a warranty for older items (since newer items don’t necessarily need to be under warranty right away).
Your Budget
Home warranty companies offer a range of plans and pricing, so go with whatever checks the majority of your coverage boxes while also fitting your budget. Gather quotes from multiple companies so you can determine the average cost for a home warranty that covers your prioritized items. If you’re not sure where to start, real estate agents are great resources to ask, or even friends and neighbors.
Contracts and Terms
Before signing on that final line of a contract, make sure to thoroughly read it so that you’re aware of what isn’t covered, any limitations to coverage and replacement policies.
How Much Do Home Warranties Cost?
When you have a fridge on the fritz or a leaky dishwasher, it’s nice to know your home warranty will save you from paying for repairs or replacements out-of-pocket. However, it’s important to learn about the price ranges for the cost of a home warranty before deciding on the yearly investment. For instance, the average cost comes in at a little over $900 per year but can fall anywhere between $214 and $1,662 per year.
What Do Home Warranties Cover?
Having home warranty coverage undoubtedly provides you with peace of mind. From household appliances like refrigerators, dishwashers, washing machines and dryers to home systems like plumbing, electrical systems, and HVACs, home warranties ensure you can affordably repair, maintain and potentially replace home systems and appliances. This way, you don’t have to pay for repairs or replacements out of pocket and can hopefully save money in the long run.
What Don’t Home Warranties Cover?
As aforementioned, home warranties are beneficial for repairing and replacing household appliances and home systems. However, the extent of the coverage depends on the warranty company and what level of coverage you purchase.
However, some common items are generally excluded:
- Structural issues in foundations, walls, paint and flooring
- Commercial-grade equipment or systems
- Pre-existing conditions
- Normal wear and tear
- Rust, corrosion and sediment problems
- Improper maintenance, installation, design, manufacturer defect or previous repairs outside of the contract
- Detection and removal of asbestos, radon gas and mold
- Building and zoning code violations
