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What is a Home Warranty

A home warranty is a service contracts that covers the cost of repair and/or replacement, on a residential appliance and/or system, for an established period of time.

A home warranty is different from a homeowners insurance policy. Homeowners insurance is most often to cover the loss of a home and/or its contents due to a fire or  other insured natural disasters.

How Does a Home Warranty Work


Upon discovery of a damaged or non-working residential appliance and/or system, the policy holder must contact the home warranty company and file a claim.

The home warranty company often will schedule a service with one of its partnered providers who will examine the damage and report back to the home warranty company.

When/if the claim is approved by the home warranty company, the partnered provider will schedule a time to repair and/or replace the failed appliance or system.

Often times there is a deductible (fee can vary from ccmpany to company) to be paid by the policy holder and frequently there are additional fees and/or non covered costs that must be paid. Often times, if a repair or replacement costs more than the home warranty contract limit, the homeowner must cover the excess. 

Why Buy a Home Warranty

While you may or may not have information on the age of an appliances or system, or even their potential life cycle in years, on a home you are purchasing. There is no way to know just how well the previous owners maintained and managed the appliances and/or systems. 

When you purchase a home warranty you are insuring the maintenance and functionality of specific appliances and systems, which may break or wear out - for a specific amount of time.

Home Warranty Cost

The cost for a home warranty can vary from a couple of hundred dollars to a couple of thousand dollars, depending on the length of coverage,  deductibles and appliances/systems covered. 

A home warranty is often purchased through escrow and paid as a part of your closing costs. It can be paid for buy a buyer, seller or agent.

Am I Required to Purchase a Home Warranty

A home warranty is optional and not a required purchase. 

Ask yourself these 5 questions before purchasing one of these plans

Article By Consumer Reports | Updated: May 24, 2019

Home Warranty Companies

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Do Your Research About These Companies

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The vendors included herein are provided for your information and reference only.  You are not obligated to use any or all of these service providers; you may elect to use other vendors. Their qualifications and charges for services may vary.   Neither Compass nor I have financial interest in these service providers. We are not compensated for including them in this list.


Be advised that these vendors have not been vetted with regard to insurance or licensing, as may be required by relevant regulatory agencies.


You should conduct your own research and satisfy yourself as to all vendor qualifications and fee structure.  Compass does not guarantee the performance, adequacy, or completeness of inspections, services, products, or repairs provided by any services providers.  Neither Compass nor I will hire any vendors on your behalf.

Content by Nina Brown East Bay Realtor 
Real Estate with Nina Brown
Making Your Next Move, Your Best Move!

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