Owning a home requires more than just paying the monthly mortgage. Instead, it needs proper care and maintenance in order to remain functional and beautiful. This is easier said than done though. Incidents that occur beyond your control can put your home at risk, making it more difficult for you to keep your home in top shape. For instance, regardless of how sturdy your home is, it remains unprotected against natural disasters and fire incidents. Such events are unpredictable and uncontrollable. Not to mention that costs related to repairs or reconstruction for damages caused by such take a while and are bound to be expensive. So, what do you do to keep your home protected from hazards and unforeseen events which can cause damage to your home? Fortunately, there is a way to be financially secure against all the odds by availing Homeowners Insurance and Home Warranty.
Homeowners Insurance Policy
A homeowners insurance policy protects you and your home from any loss or ruin caused by fire, “acts of God”, natural disasters, accidents or threats. The policy will provide a more thorough list of which particular incidents you are protected from, but they include both interior and exterior elements of your home and personal property. Moreover, any accidents that occur within your home are insured as well. Lenders also usually require those who’ve taken out a mortgage loan to also avail homeowners insurance as a way of protecting their personal interests.
Homeowners Insurance VS Home Warranty
Opting for a home warranty is totally up to you. Partly because while the homeowners insurance is a payment deductible, home warranty is not. You get charged a fee of about $100 or more. A home warranty acts like a contract and protects appliances and systems within your home. If a piece or the appliance itself breaks down, it takes care of repair or replacement costs.
Heating and cooling systems, plumbing and electrical support generally are listed under home warranty coverage. The same goes for the typical appliances within the home such as the refrigerator, dryer, washer, oven and stove. By paying an extra charge, you can also include coverage for your swimming pool and hot tub.
In general, home warranty contracts last for 12 months and can be renewed. Plans range from cheap to really expensive ones, often starting at a $400 annual fee. The more expensive options offer a wide-range coverage but also less out-of-pocket expense. The cheaper versions provide just the basic level of support and protection.
The coverage on appliances is what differentiates the two. While home insurance seems all-embracing, there are certain holes to the plan. If the damage in the appliance is not due to the conditions stated on the coverage i.e. fire, “acts of God,” etc., it would not cover repair or replacement costs. Technically, if the cause of the damage is not natural disaster-related, they are out of the home insurance’s scope- which is why it is best to opt for both. When you avail for both, you cover the gaps and will be more financially secured.
Is it worth it?
While home insurance is mandatory, you can weigh your options before opting to get a home warranty. Research well and understand what each coverage includes. Read the stipulations carefully and gauge scenarios which may require you to spend out-of-pocket money. Go through reviews and find out if the company is trustworthy, reputable and has a good Better Business Bureau rating.
One way to find out if an appliance is worth getting a warranty for is by gauging how long the said appliance is likely to last and how much any of its parts would cost if it were to be repaired or replaced. After, compare this to the amount you would be paying for the home warranty. Is it worth it? Take note, though, that this is only an educated guess and there is still that likelihood that you would never require a repair or replacement at all during the warranty coverage.
You can also consult with a home inspector to help you decide. Let a professional assess the situation and provide you sound advice.
At the end of the day, the responsibility of ensuring your home is protected lies with you. Don’t be quick in making a decision. Take your time to review and weigh your options.
About Thayer Innes and Freeman Bunting Insurance Agencies
At Thayer-Innes Insurance Agency and Freeman Bunting Insurance Agency, we strive to provide comprehensive insurance solutions to support Ann Arbor homeowners. Our homeowners’ policies can be tailored to meet your specific risk exposures and provides much more coverage than a traditional policy, giving you the peace of mind you deserve. For more information about our products, contact us today at (855) 395-6316.