Home Warranties: Great with the run-of-the-mill mishaps, terrible in emergencies
Home warranty plans are designed to help you repair or replace the mechanical systems in your home that malfunction because of regular wear and tear. These warranties aren’t required, since they don’t affect the physical structure of your home. Still, they can save you a lot of money if your washer, dryer, and refrigerator all go kaput at the same time. It happens, by the way. The more electronically loaded your home is, the more seriously you should consider purchasing a home warranty. An annual home warranty will cover HVAC problems, electrical issues, certain plumbing problems, and appliance malfunctions – provided those problems are solely a result of normal breakdowns and not related to natural disasters like floods, freezes, earthquakes, or fire. Unfortunately, natural disasters happen and wreak havoc on your home and its mechanical systems. That’s where homeowners insurance comes in.
Homeowners Insurance: Great for emergencies, terrible with routine breakdowns
Homeowners insurance is required by your mortgage company to protect their investment as well as your ability to repay your debt to them. It covers all the things that you can’t control, like freezes, tornadoes, hurricanes, and theft. When Fred and Wilma’s dishwasher breaks because it was one of the first models ever made and it is dying a noble death of natural causes, their home warranty would replace it without a problem. When their new dishwasher breaks because of a hard freeze, they should make an insurance claim. Just as you use different types of health care for different types of physical problems or just as you might find yourself refinancing a car and using different methods to do so, at times you’ll need the different coverages offered by both homeowner’s insurance and home warranties. For example, when your body needs routine maintenance, you make a call to set up an appointment for a checkup. When you have an emergency, you’ll hurry straight to the emergency room. In this case, think of your homeowners insurance as emergency room service for when disaster strikes your property, and your home warranty plan as the family doctor for the run-of-the-mill aches and pains of your mechanical appliances and systems. If you have a mortgage, you already have homeowners insurance. Whether or not you choose to purchase a home warranty depends on how likely your appliances are to need service in the next twelve months. There will be a service charge, but if you should need any large appliance replaced or your HVAC system overhauled, you’ll be glad you had it. Best of all, you’ll never have any reason to call anyone and angrily give them a piece of your mind. –