There is often a lot of confusion around the differences between home warranty and home insurance which we are going to clear up today. Sadly this has meant that in many cases homeowners have had to pay out much more than they should have for things that they believed were under protection by their home insurance. The first thing to mention is that home warranty offered by the likes of First American Home Warranty and home insurance are two very different things, so let’s take a deeper look into those differences and which of the two you need.
Let’s get started with home insurance an obligatory insurance if you are getting a mortgage and one which all homeowners should have. A home insurance policy will cover the structure of the property and the personal possessions which reside inside the property. This policy will protect you against floods, theft, or damage caused to the property as a result of adverse weather conditions. You will also be covered in the case of damage to possessions or your home as a result of an accident.
Many experts will suggest that buyers of home insurance should also look to ensure that they also have a home warrant policy for their home. A home warranty will cover the systems in your home such as HVAC, plumbing, electricity and gas. This policy will cover any damage to those systems or any upgrades or repairs which need to be completed. When you compare home warranty plans the key difference which you will find will be the value up to which it covers you and the deductible which you will be charged when you use it. The only other differences between companies offering home warranty policies are things like reviews and customer service.
The best way to describe how these two differ is to look at an example of how both of these policies can help you and protect your home. Let’s assume that you lived somewhere that has a risk of natural disaster like California or Florida. Now let’s assume that there is a hurricane which damages the structure of the home and causes a leak. The home insurance in this situation will help you in repairing your home and replacing any possessions which have been damaged as a result of the leak, but they won’t cover the leaking pipe itself. This is where your home warranty policy will kick and they will give you the financial and expert support to ensure that the plumbing in your home is fully reviewed and repaired where necessary.
As you can see there is a big difference between what these two policies cover and it is generally suggested that any homeowner should have both policies to ensure that they are completely covered against any eventuality. Accidents and issues happen all the time when you are a homeowner, so make sure that you have full cover.