Last summer I bought my first home. I went ahead and paid the $450 or so for a home warranty, covering some basic appliances and stuff. I’ve never had to use their services.
Now, that coverage is about to expire and the company sent me an offer to renew for $400.
Coverage includes central heat & air, water heater, plumbing system, electrical system, some of my kitchen appliances like the oven and stove and microwave, etc.
Seeing as how I’ve never had to use their services, I’m wondering if I should renew or not and I thought I’d throw this out to the Dope to see what the consensus is.
I have a warranty on heating/cooling/electrical through my energy provider, but it’s less than $400 a year - I pay $16 per month. And my house is almost 60 years old plus I’m not a DIY-er when it comes to those systems, so it’s way worth it to me. I did have my water heater replaced under warranty two years ago, which right there paid for 2-3 years of warranty payments.
I’m assuming your homeowner’s insurance will cover a lot too, so I’d say it’s possibly worth it as long as there isn’t a lot of overlap on coverage, especially if your house is 20+ years old.
They probably vary, but my experience is that home warranties are largely a waste of money. We had one that was “included” when we bought one of our houses (the seller paid for it). We had to use their service providers, who were generally terrible, and wanted to fix things the cheapest way possible rather than the right way. Our preference is usually to pay more to have something done right. Also, they liked to try to find ways to claim something wasn’t covered.
FWIW I’ve never bought an extended warranty on anything in my life and have never once regretted it. Maybe one day it’ll catch up with me, but in, what 30 years of adulthood on my own nothing has ever broke that would have been covered by an extended warranty.
I’ve purchased many and had to use many. I’ve had laptops, TVs, BR players and a handful of other items repaired or replaced because I purchased the extended warranty.
I voted no - turn down the warranty offer. Also google your HSA.
Insurance companies exist for one reason, and one reason only: to make money. For themselves - certainly not for the consumer. If a consumer comes out ahead, that means their underwriters have failed and are out of a job.
I use my home warrenty policy for covered repairs and always ask how much the service call would be if I was not insured. I have come out ahead. However, my biggest repair, replacing the water main drain from outside the house to the street was not covered.
I am told they try to ‘get you’ with ac and furnace replacement by making up extra work you don’t need or if you do, they overcharge for.
Still, the home warrenty insurance makes me feel secure. The service cost is $65 per claim.
All depends on the age and condition of the appliances and systems that are covered.
It’s very worth it for us, as we have a very old house (60+ years) we bought last Fall and all of the appliances and systems are near or past their expected end-of-life. We have HMS and so far they’ve been awesome; the seller paid for the first year and we’ve used it a couple of times already. We’ve got a brand new, $600 clothes dryer coming next week, in fact; all it’ll cost us is the $100 deductible.
So for us, it’s a no-brainer to keep renewing the warranty, at least until most or all of the old appliances get replaced.
Things may be different where I live (Sydney, Australia) but we’ve lived in this house for over 30 years and had two types of house insurance. Insurance on the house itself (damage to the buildings from whatever cause) and insurance on the contents (damage, theft). We’ve never used it but I wouldn’t be without the peace of mind it brings.
I had one for several years with American Home Shield. The first year was “free.” (paid for by the seller I presume. I needed a new heat pump and got one with no charge and no hassle. That was pretty great, saved me about $4,000. After that, claims usually had some exception (“commercial stoves not covered,” “appliances under manufacturer warranty not covered,” etc.) or they just kept trying to fix things that clearly needed to be replaced. Some years it was probably a good deal for me, some years a good deal for them. Eventually (with mostly new appliances) I cancelled it and am now “self insured.”
Those aren’t the same as a warranty. If your AC simply stops working, a warranty will cover some percent of the repair bill. Insurance would fix the AC if a free fell on it or whatever.
Never buy insurance to cover any risk you can cover yourself.
The cost of insurance (including warranties) is ALWAYS more than the average cost of the risk you’re insuring against. That’s how companies make money selling it.
The seller of our house included a warranty as part of the deal. We discovered a leak in a shower. Called the company up. Nada. Not their problem. They were actually surprised that someone would call thinking that they’d do something.
Home warranties are a bit misnamed. They don’t warrant your home, they cover appliances. Washer & dryer, dishwasher, heating/AC, water heater. Basic issues with the building, including pipes and caulking, aren’t part of that.
I’ve gotten a 1 year warranty on every house I’ve bought because, why not? The seller pays. I got a free furnace out of it once. After that year, let it lapse.
Depends on the warranty. Ours covered plumbing. They simply declared it a non-plumbing problem over the phone. It was a plumbing problem, the tub drain was bad.
Oh, TNSTAAFL. The seller will expect more $ from the buyer to cover the warranty.
Huh - it seems like multiple people here have gotten first year free because the seller was paying for it. It sounds like the warranty companies are pushing/advertising (and maybe giving away) the plans to sellers, so buyers already have it in place. Getting someone to renew something they already have is always easier than selling it to them in the first place.
Anyway, I’m voting no. Put that $400/yr in a separate bank account if you like, and use it for repairs.
When I bought my home, I got one of those warranties for free from the real estate company. Every single item I tried to have fixed we were told was the house equivalent of a pre-existing condition that they wouldn’t fix. But in being given the insurance, I was told that covering these problems is precisely what the insurance was intended to cover.
It might be a different experience with a new house, but my experience is that the builder themselves are usually on the hook for warranty work in the first few years. So probably not worth it in any home.