Trying to decide between warranties? Here is all you need to know about what a home warranty covers and how that differs from a manufacturer's warranty.
When it comes to owning a home, it can be confusing to wade through the different kinds of warranties to find the one that's right for you. While some warranties only cover individual appliances and systems, the best warranties have comprehensive protection plans designed to cover your entire home.
So what is the difference between home warranties and manufacturer's warranties, and which will give you the best protection?
What is a manufacturer's warranty?
Manufacturer's warranties offer repair, service and replacement of a specific appliance or system. These warranties are offered by the original equipment manufacturer, or OEM. Contracts are usually limited to one year, unless you also purchase an extended warranty. An extended warranty may also be offered through the OEM, through the store or dealer where the purchase was made or even through a third-party company. Some credit card companies also offer extended warranties as incentives to potential new users.
A manufacturer's warranty usually covers parts and labor for twelve 12 months from the purchase date (or sometimes the date of installation) of the appliance or system. It's important to note that a manufacturer's warranty coverage is limited to the original purchase made by the original owner. That means if you "inherit" a faulty stove or inefficient air conditioner when you purchase a home, you can't take advantage of the warranty contracts between the manufacturer and the original buyer/owner.
What is a home warranty?
A home warranty is different from a manufacturer's warranty in that it typically covers the repair and/or replacement of all major household appliances, including washers, refrigerators, stoves and dishwashers, as well as expensive systems, like central heating and plumbing. As with most service contracts, these repairs or replacements are limited to issues that occur during regular use.
Unlike a manufacturer's warranty, a home warranty can cover parts and labor costs for all appliances and systems in your home — regardless of who bought it or the original date of purchase — for the length of your contract (usually one year). For this reason alone, the expansive coverage offered by a good home warranty is a life-saver, especially when it comes to older homes and homes with built-in appliances or other custom features that may rack up additional labor costs.
How to choose between warranties
When it comes to figuring out exactly what kind of warranty that you need, it's important to take the time to understand all of the details. Here are some questions you should ask when reviewing any warranty contract:
- What repairs and services are covered? What's not covered?
- What's the average time between the service call and the arrival of the technician?
- Are second opinions or second estimates required?
- Is there a deductible, and if so, how much?
- Will you be reimbursed for damages incurred, such as food spoilage due to freezer failure?
- How long is the term of service, and what's the renewal process?
If you're a homeowner, you know it's not a matter of if something will break down, but when. That's why homeowners across America rely on the service and coverage of an American Home Shield Home Warranty®.