Even though home warranty and homeowner insurance have similarities, they are different in a lot of ways. We discuss the difference and which one to go for.
For potential homeowners, the home-buying process is a marathon. They go through all the obstacles and hurdles of looking for a reliable real estate agent, finding the right property, securing the mortgage, paying the upfront cost, and (finally) moving in.
As a potential homeowner, you might think that moving to a new property means you have reached the finish line of the marathon. Well, that is not how it works. You will still have damages, repairs, and maintenance to take care of.
Before these expenses get out of hand, you can call in the cavalry to cover the costs for fixing damages, making repairs, for saving yourself from a hassle. For this, you normally have two options to choose from, home warranty and homeowner insurance.
Confused about what they are and which one will serve your purpose? Well, you are about to have your queries resolved. We will discuss the nitty gritty of home warranties and homeowner insurance, helping you decide which one to go for.
Here we go.
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There are many home components around your house prone to wear and tear over time. This can lead to malfunctions and damages, costing you a lot of dollars. Additionally, you will also have to search for a reliable technician to make the fixes.
You can save yourself from the hassles by hiring a home warranty company and opting for coverage that meets your needs. Home warranty coverage is for the repair, maintenance, and replacement of home components.
These home components usually include systems and appliances. Not only will the home warranty company bear all the expenses for repairs, maintenance, and repairs, but they will also have licensed technicians to ensure covered components are working fine.
All you have to do during this process is wait while the home warranty providers do their thing.
If you think home warranty plans are something that can ease your day-to-day activities, you would want to know how it works. Once you have signed up for a home warranty plan, here is how you can file a claim.
You figure out how the potential reasons why the malfunction or damage took place and if it is covered in your home warranty plan.
Once you have validated that the issue is within the home warranty coverage, you can contact the company through a phone call or an online form.
The home warranty company will send a reputable technician to your home to assess the damage and recommend a potential solution.
After a go-ahead from the home warranty company, the technician gets to work on fixing the home component.
When the technician is done with the repairs or replacements, you need to pay for the services. These are the service fee and additional costs if the repairs exceed the coverage limit.
A home warranty plan can cover almost all of your home components. Some of the common home warranty coverages that people opt for include
These are just some of the many home warranty coverages you can go for.
Something unexpected can cause damage at times. For dealing with uncertainties, homeowner insurance is what you need. This is a financial protection that covers structural damage to your home or personal belongings.
The third part homeowner insurance company is responsible for bearing the expenses for these uncertain occurrences. Some of the common incidents where homeowner insurance can be claimed to cover the damages from:
This is different from home warranties as they only cover natural and normal wear and tear over a period of time.
The different homeowner insurance provider may have their own process for filing a claim. Generally, here is how you can file a homeowner insurance claim.
Once the damage happens, the first step is to get in touch with the insurance company. Some homeowner insurance providers expect a phone call, while others have the online form option.
The warranty company may ask for some kind of personal verification like your name and a unique insurance number you have been given. This might also be information regarding the incident. When did the incident happen, and other specifications?
This is to verify your information regarding the incident. The evidence can be photos, videos, or any other official document.
Once the incident takes place, you need to take appropriate steps to prevent the damage from escalating. For example, if there is a pipe leakage, make sure you try to stop the flow of water.
When the insurance company has the information it needs and approves your claim, you will receive a settlement for your damage.
You can now use the received settlement to make the necessary repairs or replacements according to the damage.
After the damage is taken care of, you need to inform the insurance provider so they can close your claim.
Here are some of the common homeowner insurance types
This covers the structural damage caused by things like windstorms, hail, lightning, or others.
You can cover your personal belongings like jewelry, furniture, appliances, or other items if they are stolen or destroyed.
If there is an injury on your property, liability insurance covers the damage. This is usually your guests who unintentionally suffer some kind of damage on your property.
Additional Living CoverageWhen your home becomes uninhabitable, and you can’t live in it, the additional living coverage temporarily pays for your living expenses, like hotel stay and food, while your covered property is being repaired.
Both homeowner insurance and home warranty can shield you from a lot of unfortunate occurrences. Which one you should go for depends on your preference and the potential damage you think you may have to deal with.
Before making a choice between homeowner insurance and warranty, you need to make the choice of the property type you will buy. If you want to start shopping for your dream property, HAR.com can make it happen.
You will find properties listed from different states of the U.S. to discover the real estate that meets your preferences.
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