You’ll want to weigh the pros and cons before buying a home warranty plan for your Alabama
home—disreputable companies and additional fees can make home warranties more expensive than their worth. Repair and maintenance costs make homeownership expensive, and when those costs are unexpected—it can be a serious setback for homeowners. Purchasing a home warranty plan can offer financial security and peace of mind, but it also has its drawbacks.
That’s why Jerry
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designed to save you money on car
and home insurance
, has compiled everything you need to know about buying a home warranty in Alabama. We’ll explain what a home warranty is, how it differs from homeowners insurance, and we’ll even weigh the pros and cons. RECOMMENDEDNo spam or unwanted phone calls · No long forms
What is a home warranty?
A home warranty is a contract that covers repairs and replacements on systems and appliances in your home (think heating, plumbing, dishwashers, and refrigerators), usually for one year. You’re paying for the ability to replace or repair your home systems and appliances at a discounted rate when you buy a home warranty.
Home warranty vs. home insurance
You may be thinking: “That’s exactly what home insurance is for!”
Your homeowners insurance policy covers your home’s entire structure and its contents in the event of a covered peril—not just your appliances and home systems. You could file a claim to replace your plumbing if your pipes freeze and burst, but home insurance won’t cover wear and tear.
This is where the home warranty comes into play. A home warranty is designed to fix and replace major components of your home that wear out from daily use. However, it won’t cover systems or appliances that are damaged due to owner negligence—a clause that can present some serious problems when you submit a claim to your home warranty company.
Do you need a home warranty in Alabama?
Home warranties are not required for Alabama homeowners, but it’s often a feature in a new home sale. While it may sound enticing to have additional financial coverage for home maintenance costs, home warranties usually aren’t worth the money.
Before you buy a home warranty, you should consider your options carefully. A home warranty can provide you with peace of mind if you don’t have an emergency fund to cover unexpected maintenance costs. But if you already have enough money set aside for maintenance costs, you’re better off skipping the home warranty altogether and saving the premium.
How to choose an Alabama home warranty
If you’ve decided to purchase a home warranty policy, you should compare plans from several different companies. You’ll want the plan with the best coverage options with low payments and great customer service.
Because comparing plans isn’t as easy as it sounds, we researched for you. The table below compares five of the best home warranty companies in Alabama.
| | | | | | | |
|---|
| | | | | | | Fast response times, basic plan covers both systems and appliances |
| | | | | | | Longest reputation, highest coverage limits, lower chance of service denial |
| | | | Nevada, New Mexico, Washington, Wyoming | | | Discounts and response times |
| | | | | | | Best customer service, tons of coverage add-ons |
| | | | | | | 180-day workmanship guarantee and tons of free perks |
Be sure to read the contract carefully before you sign a home warranty agreement to ensure you’re getting the coverage you need without unexpected terms and conditions.
The pros and cons of home warranties
When you buy a house, everyone has something to say about purchasing a home warranty plan. You’ve probably heard that home warranties are a terrible waste of money from a friend, or maybe an agent or mortgage broker said you can’t live without one.
Take totalities with a grain of salt. Depending on your personal finances, preferences, and overall situation, home warranties have pros and cons. To help you decide if purchasing a home warranty is the right decision for you, take a look at the benefits and drawbacks.
Pro: Convenience
If something breaks in your home, a professional will come and repair it—no late-night research comparing local contractors during a crisis. This can be especially appealing to first-time homeowners who aren’t familiar with their home appliances and systems.
Pro: Financial peace of mind
A home warranty cushions the blow of expensive home repairs and maintenance costs. The average national cost to replace central air conditioning is $5,750, and repairing a fridge can cost between $200-$500—that’s not chump change and can pose a serious problem if you don’t have an emergency fund saved. Having a home warranty can dramatically decrease those major home maintenance costs, but you’ll have to pay a service fee.
Con: Additional fees
The standard home warranty covers homes of up to 5,000 square feet in size, but you’ll have to purchase additional coverage if your home is larger than that. And every time something in your home breaks, you’ll have to pay a service fee and deductible in addition to your annual premium.
Con: Low coverage limits and high service fees
Home warranty coverage limits range from $500 to $5,000 on average, which won’t cover the cost of expensive repairs. Add high service fees to low coverage limits, and you may be looking at a major financial setback.
Con: You may be denied coverage
Here’s the biggest drawback when it comes to home warranties: your claim may be denied due to negligence, even if you’ve maintained your home systems and appliances to the best of your ability. Most warranty companies won’t cover pre-existing conditions and will deny coverage if the previous homeowners didn’t properly maintain systems and appliances.
How to find affordable homeowners insurance in Alabama
There’s a lot to consider before deciding whether purchasing a home warranty plan is the right decision for you. But when it comes to buying home insurance, it’s a no-brainer, and Jerry
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