Real estate

Need to Buy a Home Warranty? Here’s a Guide to Choosing the Best in 2023

The average cost of owning a home has been increasing over the years. That is why a home purchase is usually considered a good investment. Home prices are more likely to go up rather than decrease.

In a report compiled by Statista, the average cost of owning a home in 2020 was $391,900. This spiked to $464,200 in 2021 and $543,600 in 2022.

In the last five years, there were spikes in home prices in 2021 and 2022.

This, however, is not the only expense associated with home ownership. Whether you are buying a new home or already own one, it is important to maintain the property.

A home warranty can protect you from impromptu and expensive spending for repairing and maintaining your home appliances and systems.

An article published by Cinch Home Services, a firm that offers home warranty service, noted that homeowners would only need to pay a one-time service fee instead of bearing the total repair cost (check out this go to blog article to read more).

There are different options for home warranty plans offered by most companies. The home warranty may cover systems, appliances, or both depending on your chosen plan.

Typical things covered by home warranty plans

System plans

  • HVAC
  • Electrical
  • Ductwork
  • Heating
  • Water heaters
  • Garbage disposals
  • Interior plumbing
  • Water heater
  • Doorbells
  • Smoke detectors

Appliances plans

  • Dishwasher
  • Washing machine
  • Garage door opener
  • Garbage disposal
  • Built-in microwave
  • Stoves
  • Oven, range, or cooktop
  • Refrigerator

How much does a home warranty cost?

Two main costs are associated with home warranties ― the premium and service call fee.

The premium fee is the upfront payment required to sign up for the home warranty service. It can be monthly or annually and varies from one company to another. The average premium fee ranges between $300 and $600 annually.

The service call fee is charged per repair request. Whenever you need a repair, you file a claim with the company, after which they send a professional technician to examine the issue. The technician will prepare an estimate for the repair.

The service fee, on average, costs $55 to $125.

Common home repairs and their cost

When you compare the repair cost to the fee charged by the home warranty companies, you will discover you are getting a good deal.

  • Washing machine – $282
  • Refrigerator – $412
  • Microwave – $200
  • Oven/range/stove/cooktop – $195
  • Garbage disposal – $250

Limitations of a home warranty

It is essential to thoroughly read the home warranty service contract before signing it. An appliance plan does not necessarily cover every damage to the appliances in your home.

Some policies may only cover damages from routine usage. The company may deny your claim if pets or pests caused the damage. The coverage may also exclude preexisting faults before the start of the policy contract.

Some companies in the service contract may list the maximum amount they will pay for specific appliances covered by the warranty.

Tips for choosing the best home warranty

A home warranty can be a good investment or a bad decision depending on the company you are dealing with.

That is why it is essential to do your due diligence when shopping for a home warranty.

Below are some tips for choosing the best home warranty company;

Determine why you need the warranty

Not all homeowners need a home warranty. If your home is recently built with newly installed appliances and systems, you may not need a home warranty, provided the manufacturers’ warranty still covers them.

Before shopping for a home warranty, list your home appliances, check for those with expired manufacturer warranties, and itemize them in order of importance.

If you are convinced that you will suffer many inconveniences in the event most of the appliances on the list develop a fault, you may need a home warranty.

Your list should help you decide whether you need an appliance plan, a system plan, or both.

Coverage and limitation

Check and shortlist home warranty companies in your area. Ask if they have a suitable plan for your need.

Provide them with the list of appliances you want to be covered. The company may send over a technician to evaluate the state of your appliances. If possible, ask the technician about any fault detected during the inspection.

Home warranty policies have limits and exclusions. Most companies will not cover the repair of preexisting damage before the start of your policy agreement.

Also, request the limitation you should expect regarding your appliances and systems.

Compare the coverage and limitations of the shortlisted companies in your area to choose the best for your need.

Compare prices

The fee charged by home warranty companies varies. A lower price does not indicate a better deal.

Evaluate what each company offers and compare it with their charged fees. A way to do this is by comparing the prices with the maximum amount they are ready to spend on repair and the policy’s limitations.

Compare the total fee for both premium and service calls with the amount you are likely to spend if you handle the repair yourself.


There is no other way to put it, technicians are strangers in your home. You only let them in because you trust the company that sends them.

Ask the company about their technicians. Confirm if they do a background check on them before hiring.

Also, ask if they are certified and licensed. One of the significant benefits of a home warranty is that you have easy access to licensed professionals.

Your repairs, if handled by an unprofessional, can lead to more damages and misdiagnoses. This means the technician may estimate a higher repair cost than normal which may exceed your maximum coverage limit.


When shopping for a home warranty, ask your friends and family if they use any company currently. They will likely recommend or warn you against using certain home warranty service providers.

Check the website of the companies you shortlisted for testimonials. You can also check online review sites to see what past clients say about them.

Ensure the company you are settling for has a good customer support department. You will need them for faster processing of your claims when needed.

If you have any questions, please ask below!