What Does a Home Warranty Cover?

Think of a home warranty as a yearly subscription that protects you from having to pay upfront if a major appliance or home system breaks down. In 2025, the typical monthly home warranty cost ranges from $25 to $50.

Many homeowners would rather pay that monthly fee than foot the bill all at once for a fix or replacement. A 2024 Forbes Home survey of 2,000 homeowners found that 94% of homeowners spent $2,800 on major appliance repairs or replacements over the last five years, and home warranty policies helped homeowners save an average of $881.60 per appliance replacement.

A home warranty policy might be the right choice if you want to protect yourself against potentially costly upfront repairs or replacements.

Specific coverage varies based on which company you buy your policy from, but a standard warranty covers the major appliances and key systems that keep your home running.

Covered Systems and Appliances

Broadly speaking, your policy will cover everything you use daily to keep your home running smoothly:

• Electrical, heating and plumbing systems
• Laundry appliances, like a washer and dryer
• Kitchen appliances, including your garbage disposal, oven, dishwasher and stove

Home Warranty Coverage Add-Ons

When you sign up for a home warranty policy, you can pay for common add-ons that vary depending on the company. These range from pools and spas to septic tanks and can even include minor roof coverage.

• Pest control
• Roof leaks
• Well pumps or sump pumps
• Pool and spas
• Septic tanks
• Central vacuum systems
• Sprinkler systems
• Water softeners
• Jetted bathtubs
• Pre-season HVAC maintenance

Generally speaking, all home warranty policies have limitations, including repair price caps. Understanding a policy’s price ceiling is important—for example, you’ve got a $1,500 coverage limit, but the cost to replace your HVAC system is $5,500, and you’ll have to pay the $4,000 difference. That’s why it’s essential to ask about policy restrictions when shopping around.

Other common exclusions include problems covered by home insurance or issues caused by neglect.

• Improperly maintained appliances, like a washing machine that breaks because it was overloaded
• Appliance problems caused explicitly by issues like floods, mold, mildew or corrosion
• Pre-existing issues, like problems found during a home inspection
• Items or appliances that weren’t correctly installed, like a bad DIY job
• Structural issues including your foundation, windows or walls
• Solar panel repairs

Once you’ve purchased your policy, you can wait anywhere from one to thirty days before a home warranty company will pay a claim. The specifics depend on which company you buy from.

A home warranty policy can last up to 10 years, but the most common term length is one year. Remember, it’s your policy and your peace of mind, so don’t hesitate to discuss all of your options with your home warranty provider.

Do you need a home warranty policy if you already have home insurance? It can be confusing to distinguish between the two. Homeowners insurance protects your home against major disasters and perils, like a tornado or a fire. If you’ve got a mortgage, the bank you borrowed money from will most likely require you to have homeowners insurance.

A home warranty, on the other hand, is optional. Its specific purpose is to help you shoulder the cost of typical household fixes.

If you’re shopping around for a home warranty, it can be tough to figure out which one is right for you—especially if you’re factoring in public opinion.

Forbes Home recently analyzed 146,478 customer comments and reviews with our Customer Sentiment Index tool. The online response was largely negative, with customers reporting frustration with denied claims, bad customer service and delays.

But not everyone feels this way. Forbes Home surveyed 1,000 home warranty policyholders in August 2024 and found that 84% were satisfied with their policy and 82% would recommend it to others.

If you’d like to compare providers at least, Forbes Home took a hard look at 19 home warranty companies, analyzed more than 50 plans and dozens of accurate price quotes, and closely reviewed each company’s policy to identify which offers the best policies in the business.

Company Highlights:

• Liberty Home Guard offers the best overall coverage
• Choice Home Warranty provides the best budget-friendly choices
• Cinch Home Services is our top pick for older homes
• The Home Service Club offers the best add-on coverage
• First American Home Warranty is best for high coverage maximum

Learn more and compare quotes from top-rated home warranty companies.

Between the monthly payment and the uncertainty of whether you’ll need to use one, home warranties aren’t for everyone. If you’d rather handle household fixes as needed, other options exist.

• Secure a home equity line of credit (HELOC) to access the equity you already have in your home for upgrades and repairs
• Invest your savings in a high-yield savings account (HYSA) and pull from it as you have to
• Opt-in for an extended appliance warranty if you’re buying a new appliance