Home repair plans vs home warranties

You might have been offered the opportunity to purchase a warranty when buying a TV, an electric razor, or a shower chair. Or you might have opened the packaging of a new hedge trimmer and found a card outlining the details of a “limited warranty.” 

Warranties like these are fairly straightforward, explicit promises by a manufacturer to repair or replace whatever item you’ve bought for a certain amount of time after purchase. 

A home warranty is not quite the same thing. 

For one thing it’s more complicated because it applies to multiple major products and systems inside the average house, and there are numerous ways to expand the coverage length and/or breadth. 

All warranties are complex, and homeowners can easily misunderstand what is covered and what’s not, and the limits of the protection a warranty provides.

The Home Service Plus® Repair Plans we offer at CenterPoint Energy are not home warranties. 

In our opinion, they’re a more cost-effective option for protecting yourself against a major expenditure for a home system repair or replacement. Allow us to elaborate…

What is a home warranty?

There are many different home warranty companies and the specifics of how they work vary from one to the next, but these are the basics: 

A home warranty is a contract between you as the homeowner and a home warranty company for discounted repair and replacement services on items such as your plumbing, HVAC, and electrical systems. It may also cover things such as dishwashers, refrigerators, cooktops, washers and dryers, garage door openers, ceiling fans, and even rekeying or pest control. 

Home warranties are commonly included in home sales as a way to give a buyer peace of mind in purchasing an older home, although they can be purchased at any time and are available for new construction, as well.

According to Forbes, the average home warranty costs $300 to $600 per year, with add-ons or extended coverages adding $100 to $500 or more.

How does a home warranty service request work?

When you have an issue with a home system or appliance–say, your air conditioner isn’t keeping the house cool–you submit a service request to the home warranty company. If the company determines your request is for a covered issue, they notify a subcontractor in your area to contact you and arrange a service call. 

Once the technician has examined the situation, they will explain what’s causing the problem–in our scenario, let’s say you need a new evaporator coil–and give you an estimate for replacing it. They’ll likely have an accurate idea of what the home warranty will cover and what it won’t. They’ll then give you a quote for the job, which they will also pass on to your warranty company. 

The warranty company will review the assessment and, if they agree with it, contact you to confirm what is covered in your home warranty. This could be considerably less than the amount for the entire job, as the warranty company may only pay for the evaporator coil, not the associated parts or labor involved in replacing it for example. 

Typically, customers have a couple of options. You can direct the home warranty company to order the coil and have it sent to the subcontractor, who will arrange a time with you to come install it. 

Some policies also allow you to choose the option to receive a cash-out value for the coil to put toward replacement by another subcontractor of your choice. In any case, there’s no ‘disagreeing’ with the dollar amount of coverage as determined by your home warranty policy, which may be significantly lower than the actual cost of replacement.

Why we think our home repair plans have the edge

No trip charges

Home warranties almost always charge a fee and typically it can range  from $75 to $125 per service visit, even if no repairs are done and even if it’s for a service you’re entitled to based on the terms of the warranty. Our home repair plans do away with those trip charges.

Home warranty contracts may be complex, and homeowners can miss the fine print exclusions from coverage or coverage limits. We think home protection plans are easier to understand and state clearly what’s covered and what’s not.

Home warranty companies may  prefer to repair a broken appliance than pay to replace it. Under some home repair plans, however, a replacement plan entitles you to a replacement with no run-around. 

How is a home repair plan different?

At  Home Service Plus, we offer three main types of home repair plans: repair, replacement, and maintenance. Within those categories we have eight distinct plans: 

• Basic Repair
• Total Repair
• Core Heating Repair
• Maintenance
  
• Replacement 
• Pipe Protection
• Main Drain Emergency Cleaning
• Electrical Surge

Our home repair plan coverage is structured so that you only pay for the coverage you want and need, and when something breaks, you don’t have to wonder if you’re covered. 

With our repair plan, two heating appliances (with CORE), four appliances (with Basic) or 12 appliances (with Total) are covered, meaning if one of them breaks, you get the repair covered–parts and labor included–with no out-of-pocket expenses, deductible, or trip charge.  You can also add additional appliances to the Basic plan on an a la carte basis.

Our maintenance plan helps you prolong the life of six of your home systems through bi-annual cleanings and tune-ups. 

With our replacement plan, if a home system covered by a repair plan becomes irreparable, you simply purchase a new one, provide Home Service Plus with the proof of purchase, and get reimbursed up to a set reimbursement limit. 

At a glance: Home repair plans vs. home warranties