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Everyone who has a mortgage has home insurance, yet the home warranty industry is multi-billion dollar one that is often forgotten or more importantly, misunderstood. We’re here to help you navigate the difference and help you decide if it’s right for you.
What Does Home Insurance Cover?
Home insurance covers major accidents and natural disasters like wind damage, fire, lightning, theft & vandalism. Home insurance will also cover your personal liability in the event of someone being injured in your home by your home.
When these disasters happen, your appliances, the foundation, the roof all are covered under your home insurance plan.
What home insurance doesn’t cover is wear and tear and breakdown of individual appliances.
Home Warranties Fill The Gap
Home insurance is there for the freak accidents and disasters that can be devastating. Home warranties cover the breakdowns and wear that happen from daily use. If your refrigerator or air condition system breaks down, home insurance won’t cover that, but a home warranty will.
Home warranties help prevent those sudden expenses for repair bills or complete replacements that can run into the thousands of dollars for many appliances.
Should I Have A Home Warranty?
If you have purchased a new home or have just upgraded many of your appliances, most likely not. Most of your appliances will be covered under manufacturer’s or store warranties.
However, if your appliances are a few years old it may be time to consider a home warranty.
In no way is a home warranty required, but if you’re the type of person who would rather be safe than sorry and don’t want to run up the credit card bill on a brand new appliance then home warranties are your speed.
The value will be when one of your appliances or systems break down. For me, I’ve just recently had to replace my dishwasher and had an expensive AC unit repair. That’s $2,000 in total and with a home warranty, it would have been covered.