How Long Does a Home Warranty Last?

Learn how long a home warranty lasts and how to decide whether investing in a warranty is worth your time and effort.

Written by Stephanie Minasian-Koncewicz Updated 12/19/2024

A home warranty provides coverage for repairs or replacements when a household’s major appliances or major systems stop working due to normal wear and tear. Paying for a home warranty can help you avoid unexpected costs. Our guide below explores the ins and outs of coverage options, how long warranties typically last, and factors that could influence the duration of coverage. This should help you to decide whether a home warranty is right for you.

What Is the Standard Length of a Home Warranty?

The standard length of a home warranty is typically one year. Most home warranty plans offer the option to renew annually, so you can review your contract and determine whether it’s still valuable to you.

Some home warranty companies may offer extended plans that last up to five years. These plans can protect your home against breakdowns for longer periods of time but are typically more expensive.

While homeowners insurance protects your home’s structure and belongings from specific events such as fire, theft, or natural disasters, a home warranty functions more like a service contract. It covers repair or replacement costs when major appliances and systems break down.

What Does a Home Warranty Cover During Its Term?

What, exactly, a home warranty covers varies depending on your specific plan, but most home warranties cover the following:

Electrical systems, such as circuit breakers, wiring, and electrical outlets.
HVAC systems, such as furnaces, air conditioners, ventilation systems, and thermostats.
Major kitchen appliances, such as refrigerators, ovens, cooktops, and dishwashers.
Other major home appliances, such as washers, dryers, and water heaters.
Plumbing systems, such as pipes, toilets, garbage disposals, and main water shut-off valves.
Some home warranties allow add-ons, such as swimming pools or sump pumps, for an additional charge.

Make sure you read your home warranty contract carefully. There may be per-item coverage limits on covered items or exclusions for pre-existing conditions, cosmetic defects, or improper maintenance.

Factors That Impact Home Warranty Length

The standard length of a home warranty is typically one year, though several factors can change the duration of your coverage:

Type of property: The type of property you own can affect how long your home warranty lasts. New homes typically come with a builder’s warranty that lasts several years. This warranty covers structural defects and may overlap with the length of your home warranty. Condo owners may have limited options on which home warranties they can purchase.
Level of coverage: The level of coverage you choose can change how long your warranty lasts. Basic plans that cover a limited number of major home appliances or systems might have a one-year term. More comprehensive plans that cover a wider range of items might come with multi-year coverage at a higher cost.
Provider: Different home warranty companies will cover you for different lengths of time. Some providers focus on one-year plans, while others offer extended home warranties. Compare plans from different providers.

Is a Home Warranty Worth It?

Whether a home warranty is worth the monthly fees and deductible depends on your circumstances, budget, and priorities. Below are some pros and cons of home warranties to help you decide.

Benefits of a Home Warranty

There are some significant advantages to purchasing a home warranty, including the following:

Convenient repair services: Your home warranty provider can streamline the repair process once you’ve made a claim. They’ll handle finding qualified repair technicians, scheduling appointments, and dealing with service providers. This can save you a lot of time and hassle.
Easier household budgeting: Major appliance and home system breakdowns can put a big strain on your budget. A home warranty can offer some financial protection by covering those expenses for a fixed monthly fee plus a deductible. This can make getting essential items repaired or replaced more affordable, make it easier to plan your monthly budget, and reduce your out-of-pocket expenses.
Transfers to new owners: A home warranty can be an attractive selling point for potential buyers if you’re planning on selling your home in the near future. Many home warranty companies allow you to transfer your existing warranty to new homeowners.

Drawbacks of a Home Warranty

Home warranties have some great benefits, but there are also some potential drawbacks to consider, including the following:

Annual costs: Home warranty plans typically require an annual premium, which costs between $200 and $1,800 on average. You’ll also need to pay a service charge or deductible for every warranty claim you make. Weigh these costs against the potential benefits and the likelihood that you’ll use the warranty during your coverage period. A home warranty might not offer much value if you have a newer home.
Exclusions and limits: Home warranty contracts often exclude repairs on pre-existing conditions, improper maintenance, or cosmetic damage. They may also come with coverage limits that restrict how much the company will pay to repair or replace a covered item. Make sure you know the exclusions and limits in your home warranty.
No choice in service technicians: Home warranty companies typically use networks of pre-approved repair technicians. These technicians will be qualified, but you may not be able to choose which one will complete your repairs.
Waiting periods: There is usually a 30-day waiting period between when you purchase your home warranty and when your coverage starts. If something breaks down in your home during the waiting period, the new home warranty won’t cover it.

*Cost data in this article sourced from Angi.

Alternatives to a Home Warranty

Home warranties are just one way to manage potential repair and replacement costs for your home’s appliances and systems. Below are some alternatives to home warranties you can consider instead:

Maintain appliances and systems diligently to extend their lifespans: Regular maintenance can reduce the need for repairs and replacements. Follow manufacturers’ recommended maintenance schedules to help you avoid costly breakdowns.
Purchase new appliances and systems with a manufacturer’s warranty: These warranties are often included in the purchase price and cover repairs needed because of defects in materials or workmanship. These warranties typically last for a year, but you may be able to purchase more comprehensive, extended warranties for an additional cost.
Save for an emergency fund: Set aside a specific amount each year to cover future appliance and system breakdowns. Building an emergency fund can help you manage unexpected events.

Our Conclusion

Consider how long a home warranty’s coverage lasts, the coverage details, and how much coverage costs to help you decide whether a warranty is right for you. If you have a newer home with newer appliances or a healthy emergency fund, then a home warranty may not offer much value. However, if you have an older home with appliances and systems that are nearing the end of their lifespans, a home warranty can be a valuable tool. Weigh the pros and cons and determine the best approach to protecting your home and finances.

FAQ About How Long Home Warranties Last

How often should you renew a home warranty?

You can renew a home warranty annually. The initial coverage period typically lasts for one year.

Do home warranties have coverage limits?

Yes, home warranties frequently have coverage limits regarding the amount they’ll cover per repair or item. A warranty may exclude certain things, such as cosmetic issues, entirely.

Is a home warranty the same as homeowners insurance?

No, home warranties are not the same as homeowners insurance. Home warranties cover repairs or replacements on appliances and systems because of normal wear. Home insurance protects your home’s structure and belongings from fire, theft, vandalism, or weather events.

How much does a typical home warranty cost per year?

Premiums for a typical home warranty cost between $200 and $1,800 per year.

Can you cancel a home warranty before the term ends?

Yes, you can usually cancel a home warranty before the term ends, but you may need to pay cancellation fees. Check the terms of your contract for details.

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