Should we renew our home warranty?

In My Humble Opinion
1

We moved into our new house a year ago. Well–new to US; it was built in 1956. It has a new roof, new windows, new garage door, and new copper plumbing (though only on the outgoing pipes). It was termite-tented in February.

We need to decide pretty much today whether or not to spend $400 to renew the home warranty. In the past year, we did use the warranty twice: once when the A/C quit (during a 108 degree holiday weekend, thankyouverymuch…AUGH) and apparently needed some part replaced, and once when the shower suddenly filled with water. The plumber said it was just due to a lot of hair in the pipe, and he snaked it for us…but it seemed odd that hair (normally a slow clog IME) would cause the pan to suddenly fill with water halfway through a showering session. But–I’m not a plumber.

The $400 would cover the central vacuum system, cooktop, dishwasher, electrical, exhaust fans, garage door opener, garbage disposal, heating, instant hot water heater, microwave, over range, pest control, plumbing, plumbing stoppages, toilet tanks & bowls, water heater, and central a/c. Since we plan to remodel, a lot of those appliance coverages won’t matter.

For extra, we can add on the sewage ejector pump and well pump (there are other irrelevent items).

If we renew, we’re basically saying we assume we’ll have at least $400 in repairs this year. It’s a gamble. Oh, there is also a service call fee of $55.

We have homeowner’s insurance, but I don’t know how it differs from the warranty. I’ll call later to find out.

So, experienced home owning Dopers, what has been your experience, and what is your recommendation, on renewing a home warranty?

2

Well, I’ve renewed mine three years now and gotten my money’s worth every time. This year it paid for a new water heater and a new motor for my old air conditioning, which would have cost me 900+ plus labor. I am considering not renewing this year, though, because I have replaced all the appliances and stuff except the HVAC, and the warranties don’t do much for the roof and stuff - they pay for repairs but not water damage. So I need to make a decision by the end of the month.

My opinion? Do it for a few years. You don’t know what’s going to crap out in a new-to-you house, and it’s been worth it ten times over for me.

3

What exactly is a homeowner warranty? I’ve seen it mentioned a couple times on the Board but haven’t heard of it before.

Usually a “warranty” is a guarantee from a manufacturer, but from your description it sounds like it’s basically “repair insurance.” Is that right?

FWIW, my homeowner’s insurance covers only major damage, fire, flood, property loss, vandalism, burglary, etc. but not routine repairs. However, I live in an apartment co-op and the we pay maintenance fees that cover all the routine stuff.

4

Zsofia, a compelling argument. My main concern is electrical…we haven’t had problems, but 50+yro wiring makes me nervous.

Friedo, yes, essentially it’s repair insurance. It’s a typical add-on when buying a home, paid for by the seller. That way the buyer doesn’t move into their home and 2 months later is dealing with the crapped-out A/C in, oh, 108 degree weather. It’s a warranty in the sense that the buyer can relax in their new (to them) home for a year, without worrying about shelling out $9500 (as my friend is) unexpectedly for a new a/c.

BTW, DeathLlama corrected me. We have new copper plumbing on the incoming, not outgoing, pipes. It’s not needed for outgoing. Noted. :wink:

5

I wish I’d known about a home warranty before my AC went kaput last week. :smack:

6

Experience: Currently own a house built in '56, and my guess is you WILL have $400 in edpenses in a year on a home thi age.

Particularly if the people you deal with have been proven to show up and get the work done, I’d keep it.

7

To be more specific, here are some things that my home warranty has paid for, with a service call fee that started out as $55 but has gone up to $75.

Air not working - wiring issue.
Air not working - new part
Heat not working - new thermostat
Garbage disposal repair
Refrigerator repair - new thermostat thing
Dishwasher repair - new part
Water heater repair - some new thing
Water heater replacement
Air conditioner motor replacement - extremely expensive rare motor

Most of these things required more than one visit (the service call fee covers as many visits as they need), funny parts, labor, etc. So far, it’s been worth it entirely.

However, like I said, a lot of the benefit is with appliances, which I have gradually replaced. The last remaining big ticket item is the HVAC. I’m going to seek some quotes on replacement to help me decide on if I’m renewing again - there’s also the increased efficiency of a new model to consider. If I did replace the HVAC I don’t think I would renew the warranty.

ETA - for comparison, my house was built in 1928. The HVAC is about 20 years old, but everything else was probably put in in the remodel ten years ago. I have replaced the dishwasher, fridge, and range. The warranty replaced the water heater for me.

8

Well, we called and wound up renewing the warranty today. My gut was saying to do it, and I would HATE it if my gut would be telling me “I told you so!” in the near future.

Thanks for the experiences and advice!

9

Sounds like it covers a lot of stuff that won’t be cheap if they break. I would have expected it to be a lot more expensive. Only $400? Get it.

10

Yeah, you spend more than $400 every time you go to Lowe’s in the first year or so of homeownership.

11

My Mom had one. Never failed to get her money’s worth every year for the last 15, living in a late 70s condo.

I’ve never had one, and having one would be a money loser for me every year so far. I did need to replace my dishwasher this year for > $400, but I as understand the warantees, they cover repair, not replacement.

12

They cover replacement if the unit can’t be repaired. Mine does, anyway (Old Republic.) The contractors have to call in and plead your case, and the warranty is going to want to give you the cheapest suitable unit, but in the thermostat case at any rate they were willing to let me pay to make up the difference and install the one I wanted. On the water heater they repaired it once and it failed again, and so they gave me a new one.