Identifying The Different Types Of Home Warranty Plans

Sep 24, 2017

When it comes to home warranty, companies that provide this type of service usually offer two or more plans for their customers to choose from. With other services, plans usually differ according to the price, but in the case of home warranty, the difference is usually based on which (and how many) appliances and home systems are included.

Home warranty providers want to be competitive and attract as many new customers as possible, which is why they usually offer several options for coverage. If they offered just one plan, it would probably be too expensive for some customers, too narrow for others, and so on. Providing flexibility is the key to success and these companies definitely understand this. So let’s take a look at some common types of home warranty plans.

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Systems and Appliances plans

Many home warranty providers offer two basic types of plans – one for your home systems and one for your appliances. Home system plans usually include air conditioning, heating, electrical system, plumbing, garbage disposal, garage door opening, central vacuum, smoke detectors and other systems commonly found in most households.

The Appliance plans, on the other hand, include some of the most common household appliances such as refrigerator, freezer, washer and dryer, dishwasher, range/stove/cooktop/oven, built-in microwave oven, built-in food processor, ice maker and so on.

As you can see, when choosing between these two types of plans, you can decide whether you want your appliances or your systems to be covered. You can, of course, opt for both, but it’s going to cost you twice as much, which is why many companies also offer combo plans. Combo or hybrid plans combine all the items covered in the systems and appliances plans and the price is usually somewhat lower than the two plans combined. Combo plans are usually the most popular ones since they provide maximum coverage and even save you some money.

Build-your-own and customizable plans

Some home warranty companies (not all of them) offer the possibility of creating your own coverage or customizing the existing plans according to your specific needs. Customers usually get to pick ten or more appliances and systems from the list and the price is calculated once the list is complete and all the other factors (such as location) are taken into consideration.

Specific plans

Coverage plans divided into systems and appliances or plans that differ according to the number of systems and appliances they cover are the most common types of home warranty plans. Some companies offer other, more specific types of coverage as well, for example, AC coverage or kitchen appliance coverage. These plans are designed to cover only specific types of systems and appliances and they cost less than more comprehensive plans covering various types of appliances and systems. They are ideal for homeowners who do not want to pay a lot of money to have a large group of appliances covered and instead just want protection in case a specific appliance or system breaks down.

AC coverage is the most common type of these specific plans since it covers a system that is the most expensive to repair. Kitchen appliances are also widely present and they are known for breaking down frequently, so purchasing a specific plan for these appliances actually makes a lot of sense.

Additional coverage

Almost all home warranty providers, on top of their standard coverage plans, also offer additional coverage for systems and appliances that are not normally found in every home, such as spa and pool equipment, pest control, well pump, septic tank/pump, additional freezers and refrigerators and so on. These items are not included in standard plans because pools, for example, might be common in certain regions, but in others, they are certainly not.

The same goes for, say, septic tanks, which are usually found in houses in rural or remote regions, so it doesn’t make any sense including them in standard plans. On the other hand, these systems also require coverage since they too tend to break down and malfunction, so including them in additional coverage might be a good idea.

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