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What Is Home Warranty Insurance and What Does It Cover?

Understanding home warranty insurance Home warranties are different from standard homeowners’ insurance. Homeowners’ insurance pays for damage caused by unexpected perils, while a home warranty pays for service, repair, or replacement of vital home systems. Attorney Bill Voss explains what may be covered under your home warranty and how to get everything you’re owed when making an insurance claim.

Is My House Covered by a Home Warranty?

Home warranties are renewable service contracts issued by an insurance company. They’re often issued with the purchase of a house and typically last a year It’s a good idea to have both forms of coverage since home warranties pay for damage caused by regular wear and tear—a cost homeowners’ insurance won’t cover.

If you have a home warranty, you must read your policy carefully to see what's included, as your policy covers only appliances and systems listed in the contract. For example, your home warranty policy could provide:

Home Systems Coverage

  • Air conditioning. Such as repairs and refrigerant replacement for central air and wall air conditioners (window units are excluded)
  • Heating units. Including forced air (powered by gas, electric, or oil), enclosed hot water or steam heat, electric baseboards, room heaters, wall-mounted heaters, and other non-portable systems
  • Ductwork. Including fixing leaks or breaks in ductwork, plenums, and dampers
  • Interior plumbing. Such as clearing clogs in sinks, bathtubs, showers, and toilets, replacing rusted or corroded pipes, and installing new faucets and valves
  • Interior electrical systems. Including main breaker, fuse panel box, direct current wiring, built-in exhaust or vent fans, doorbells, garage door openers, ceiling fans, or home security systems
  • Water heaters. (Conventional and tankless), including replacement components and building code modifications
  • Toilet. Including repair, replacement, or clearing stoppages not caused by collapsed sewer lines or tree roots
  • Roof leaks. Caused by broken or missing shingles, dry rot, freezing and thawing cycles, or other normal wear and tear

Appliance Coverage

  • Refrigerators. Including correcting leaks and replacing ice machines, water filters, light bulbs, fans, and thermostats
  • Clothes washers and dryers. Including drain pumps, tub bearing, heating element, drum roller, and motor
  • Cooking elements. Including repairing gas burners, ovens, cooktops, ranges, and built-in microwaves 
  • Dishwashers and garbage disposals. Including their drains, pumps, and valves 

Supplemental Coverage

You may be able to supplement your policy if your home has certain features or utility systems that can be costly to repair. Common add-ons include:

  • Inground pools or hot tubs. Most components of unground pools and spas, including the pump, blower motor, plumbing pipes, and electrical wiring may be covered in a home warranty.
  • Well pumps. Insurers may not be willing to pay for holding tanks or re-drilling a well, but all components of a well pump that serves as a water source to the home should be covered.
  • Septic systems. Insurance may cover mainline stoppages that can be cleared without excavation, pumping out stoppages causing a septic backup, and replacing the sewage ejector pump.
  • Electronic devices. A warranty may pay for damage to desktop and laptop computers, televisions, tablets, gaming systems, smart home systems, and computer accessories (such as external hard drives).

A Home Warranty Insurer Could Act in Bad Faith

Home warranties can provide much-needed coverage, but they’re still issued by insurance companies who want to protect their profits. Fortunately, Texas’ Deceptive Trade Practices Act protects consumers from unlawful business practices and provides remedies for breach of a warranty.

There are also legal remedies for policyholders whose claims have been unfairly denied or delayed. Chapter 541 of the Texas Insurance Code allows homeowners to collect three times the value of a property damage claim if an insurer acts in bad faith.

Let Us Help You Get the Property Damage Compensation You Need

If your home has been damaged and your insurance company refuses to pay, the Voss Law Firm can help. Call us at (888) 614-7730 or complete our contact form today to get answers to your questions, or get your copy of our free book, Tricks of the Trade: How Insurance Companies Deny, Delay, Confuse, and Refuse.

 

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