Calculating Your Home Warranty Annual Expenses

In the United States, the annual expense of a home warranty typically falls in the range of $600 to $700 for a one-year plan. The standard service call fee is usually between $65 and $125. To establish our national average, we collected 120 quotes from leading providers, utilizing 2,000-square-foot homes situated in more than 20 states. However, your specific pricing can fluctuate depending on the coverage type you select, your geographic location, and the size and type of your residence.

Understanding Home Warranty Costs

If you're in the market for a new home, you're likely to receive offers for a home warranty. But what exactly is a home warranty, how does it function, and most importantly, how much does it cost annually?

In the United States, home warranty expenses average around $600 annually, contingent upon the coverage options you opt for. Discover what's included in a home warranty and gain insights into the associated expenses.

For homeowners with aging appliances and home systems, a home warranty can prove to be a prudent choice, particularly if you have budget constraints, lack experience in DIY repairs, or are currently in the process of buying or selling a property.

Choosing a plan with a lower monthly cost can be advantageous if you don't anticipate a high frequency of claims. In cases where your property features older systems and appliances, selecting a plan with a reduced service fee may be the most suitable option, as you may find yourself filing claims more frequently.

Whenever a repair is required, you simply get in touch with your warranty provider, and they will dispatch a technician to assess and resolve the issue. You will be responsible for a fixed fee for this service visit, separate from your monthly or yearly premiums.

A home warranty is essentially a service agreement covering maintenance, repairs, and sometimes replacements of significant home systems (such as HVAC, plumbing, and electrical) as well as certain appliances. These warranties are tailored to address the maintenance and potential replacement of appliances and home systems when problems arise due to natural aging and wear and tear.

Most companies offer multiple plans with varying monthly expenses, contingent on the comprehensiveness of the coverage. The graph above provides an estimate of provider pricing based on a quote for a 2,138-square-foot single-family home in Raleigh, North Carolina. Your monthly premium may fluctuate based on your chosen coverage, property size, type, and location.

The cost of a home warranty exhibits significant variability, influenced by factors such as coverage scope, property age, geographic location, warranty provider, and service fees.

A home warranty provides coverage for both accidents and damage, as well as age-related failures. In some instances, both forms of protection are indispensable. For example, if a hot water pipe bursts, flooding the basement, the home warranty will cover the repair or replacement of the pipe. Simultaneously, homeowners' insurance may cover the damage to the walls, ceiling, carpeting, and any belongings affected by the burst pipe.