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How Much Does a Home Warranty Cost in 2024?

The national average cost of a home warranty premium ranges between $36–$68 per month

Annual home warranty cost $450 to $850
Flat per-incident service fee $50 - $150

*The given cost data is based on information from open sources.

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Navigating Home Maintenance Costs with a Home Warranty

A home warranty is a contract that covers the costs of home maintenance services, including repairs and replacements of home appliances, plumbing, and electrical systems due to unexpected breakdowns or normal wear and tear. This type of warranty usually lasts for one year, with the option to extend the plan.

Homeowners are charged a fixed price every month for the length of the policy. Plus, they pay an additional service fee whenever they need a professional to come to their place to identify and fix the issue. The fee may vary from one warranty provider to another but usually has an adequate limit, preventing a homeowner from paying hundreds of bucks out of pocket.

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Factors Affecting the Final Cost of a Home Warranty

The total cost of a home warranty mainly depends on the coverage size. If you want to enjoy peace of mind, knowing all your home repair needs are fully covered, you better go for comprehensive coverage. However, if you want to skimp on the premiums, your choice is a package that covers only a few systems and appliances. Check other factors contributing to the overall home warranty estimate and monthly premiums.

Home Location

Numerous home warranty providers operate across the country. However, selecting a provider that operates in the same locale as the property requires coverage. The monthly premiums and service fees may vary from state to state, depending on the local labor costs. Besides, climate and geographical position will likely be the factors in which plans and add-on protections are chosen as well.

Home Size

The size of a house is another criterion that affects the annual cost of a home warranty policy. The larger buildings, especially those over 5.000 square feet, require higher monthly premiums. Besides, the style of the home and the number of stories in it may add to the final warranty estimate. Home extensions, garages, and guesthouses are typically not covered unless the provider offers that option as an add-on.

Coverage Level

Home warranty plans may vary from one company to another. Some warranties cover only appliances, while others provide complex protection of home systems and devices with different comprehensiveness regarding the items covered in each plan. Basic or limited plans are generally associated with lower annual fees, while combination and comprehensive ones are offered at higher monthly premiums.

Service Fee

Service fee level varies from one home warranty provider to another. The selected fee level may affect the cost of a plan, either raising the price or decreasing it. Higher service fees usually mean lower plan premiums and vice versa. Please note that attractive monthly premiums will most likely cause you to pay more out-of-pocket per claim.

Add-Ons

No home warranty would cover all systems and appliances. That is why homeowners add extra options to their basic offering, paying extra to cover them. Possible add-ons might include central AC units, water heaters, hot tubs, and well pumps. The cost of add-ons depends on the scope and complexity of the service.

Please note that home appliances and systems are covered only due to failures resulting from normal wear and tear. Improper installation and maintenance, misuse, repairs over the coverage limit, and accidental damages are excluded from coverage eligibility.

Maximize Your Investment with the Right Home Warranty Coverage

A home warranty covering all needed systems and appliances is definitely worth your while. While being relatively inexpensive, a warranty gives you peace of mind, ensuring that professionals will eliminate almost any breakdowns without extra spending out of your pocket. Besides, you won't need to research a local remodelers' market and compare quotes. Your warranty provider will take care of everything from A to Z.

Select the coverage type that best fits your needs to get the most out of your home warranty. Read the fine print to avoid disappointment by the extent of the offered coverage and additional fees. If you settle in a new house, most of the systems and appliances are covered by manufacturer warranties, so you may not need an additional warranty to cover them.

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