The Complete Home Warranty Guide (2026): Cost, Coverage & Claims

If you only remember five things from this guide, make them these:

1. A home warranty is not insurance. Homeowners insurance pays for sudden damage like fire, storms and theft. A home warranty pays for things that simply wear out. You can - and many people do - have both.
2. The caps matter more than the price. Two plans that cost the same per month can pay out very differently. One company may cap a covered appliance at about $500; another allows $3,000 or more. A cheap plan with low caps can leave you paying most of a big repair.
3. The service fee is part of the real cost. Every claim triggers a service call fee, and at many companies that fee is owed even if the claim is denied. Add expected service fees to the premium to see what you will actually pay.
4. Most denials come from a short list of exclusions - pre-existing problems, missing maintenance, improper installation, code upgrades and anything over the cap. Read those sections of the sample contract before you buy.
5. A warranty pays off most when several big-ticket items are aging at once and you don't have a comfortable repair fund. On a brand-new or recently renovated home, it is much harder to come out ahead.

The rest of this guide goes deep on each of these points: what plans cover, what they really cost, how to do the break-even math for your home, how to read a contract, how to file a claim that gets approved, what to do when one is denied, and how the seven companies we track - Choice Home Warranty, American Home Shield, Select Home Warranty, First American, Home Warranty of America, The Home Service Club and 2-10 Home Buyers Warranty - compare. Prices in this guide are approximate published figures checked in October 2026; your quote depends on your ZIP code, home and plan.

A home warranty - also called a home service contract, home protection plan or, in Texas, a residential service contract - is an agreement between you and a home warranty company. You pay a fee, usually for a 12-month term (some real estate plans run 13 months, and some companies sell multi-year terms). In return, the company agrees to arrange and pay for repairs to the systems and appliances listed in the contract, up to stated limits, when they fail from normal use.

Three features define how every home warranty works:

• It covers breakdowns, not accidents. The trigger is mechanical failure from ordinary wear and tear. A furnace whose blower motor dies after years of use is the classic home warranty claim. A furnace destroyed in a house fire is an insurance claim.
• The company controls the repair. In most plans you don't hire the technician yourself. You file a claim, and the company sends a contractor from its network, decides whether the failure is covered, and decides whether to repair, replace or offer cash. Some plans allow you to choose your own contractor, usually with approval first.
• Coverage is defined entirely by the contract. There is no standard home warranty. Every company writes its own list of covered items, exclusions, dollar caps and conditions, and those terms can differ by state. Two plans with similar names can behave very differently when something breaks.

Who sells home warranties?

Home warranties are sold by specialist companies, not by your insurer or your mortgage lender. Some are large and long-established: American Home Shield has sold home warranties since 1971 and is owned by Frontdoor, Inc., a publicly traded company that also acquired 2-10 Home Buyers Warranty in December 2024. First American Home Warranty is part of First American Financial, the title and settlement company. Others are privately held and sell mainly online, such as Choice Home Warranty (founded in 2008, and the owner of Home Warranty of America since 2022) and Select Home Warranty (selling plans since about 2012).

You can buy a plan directly from the company at any time, or as part of a home sale, where the seller, buyer or agent often arranges coverage at closing. We cover the real estate side in its own section below.

Why the "warranty" name is misleading

A manufacturer's warranty is a promise from the company that made a product to fix defects in that product. A home warranty is different: the company didn't build your furnace or your fridge. It is selling you a contract to pay for repairs, which is why consumer advocates and regulators prefer the term "service contract." The distinction matters because a home warranty company's obligations come from the contract you sign, not from any promise about product quality - so the fine print is the whole product.

Almost every home warranty company follows the same basic lifecycle. Knowing it in advance removes most of the surprises.

1. You choose a plan and pay

You pick a tier (systems, appliances, or both), any add-ons, and - at many companies - a service call fee level. You pay monthly or for the year upfront. Annual payment sometimes unlocks discounts or promotional free months.

2. The waiting period runs

Most plans bought directly have a 30-day waiting period before coverage begins. Failures in that window aren't covered. The waiting period exists to stop people from buying a plan only after something has already broken. Plans bought during a real estate closing and renewals of existing plans often have no waiting period.

3. Something breaks and you file a claim

You file online, in an app or by phone. Larger companies accept claims around the clock. You describe the problem, and the company assigns a contractor from its network, who contacts you to schedule a visit.

4. The technician diagnoses the problem - and you pay the service fee

At the visit you pay the service call fee (often called a trade call fee or deductible). The technician diagnoses the failure and reports to the warranty company, including the cause and an estimate.

5. The company decides coverage

The warranty company - not the technician - decides whether the failure is covered under your contract. This is where exclusions, conditions and caps come in. The common outcomes are:

• Approved repair: the contractor repairs the item, and the company pays up to the cap.
• Approved replacement: if repair isn't practical, the company replaces the item, typically with one of "similar features, capacity and efficiency," not necessarily the same brand or a newer model.
• Cash in lieu of repair: some companies offer a cash payment instead of a repair or replacement - often based on their own negotiated cost, which can be lower than what you would pay retail.
• Partial approval: the covered part is paid for, but you pay for uncovered parts, code upgrades or the amount over the cap.
• Denial: the failure isn't covered - for example because the company concludes it was pre-existing or caused by missing maintenance.

6. The repair is done - and guaranteed for a while

Most companies guarantee the contractor's work for a short period, commonly 30 days (some longer). If the same problem returns inside that window, the follow-up visit is usually free. After that, a recurring problem is a new claim with a new service fee.

7. The plan renews

Many plans renew automatically unless you cancel, sometimes at a higher price. Put the renewal date in your calendar and compare the renewal price against new-customer offers before letting it roll over.

Coverage is built from two building blocks - systems and appliances - plus optional add-ons. Plan names differ from company to company, but the structure is remarkably consistent.

How the seven companies we track structure their plans

"Covered" has conditions

Even when an item is on the covered list, the contract usually limits which parts and causes are covered. A refrigerator may be covered, but not its ice maker, water dispenser or the food that spoiled. A plumbing system may be covered, but not a slab leak beneath the foundation, or only up to a lower sub-limit. Air conditioning may be covered, but refrigerant recharges may be capped. That is why the right question is never "Does this plan cover my AC?" but "Which parts and failures of my AC does this plan cover, and up to how much?"

→ Read our shorter primer: What is a home warranty?

Exclusions are where most disappointment comes from. Every contract has an exclusions section, and the same handful of clauses drive the majority of denied or partly paid claims.

1. Pre-existing conditions

Almost every contract excludes problems that existed before coverage began. This is the most common reason for denial, and it is also the most contested, because it relies on the technician's judgment about when a failure "started." Some contracts cover pre-existing conditions that couldn't have been detected by a visual inspection or simple mechanical test; others exclude them outright. If you're buying a home, keep the inspection report - it can help show an item was working at closing.

2. Lack of maintenance, misuse and improper installation

Contracts typically exclude failures caused by missing routine maintenance (for example, an air conditioner that was never serviced or a furnace filter never changed), by improper installation or repair, or by misuse. The burden often falls on you to show reasonable care, which is why keeping receipts for HVAC service and other maintenance is the single cheapest way to protect your coverage.

3. Code upgrades, permits and modifications

When an old system is replaced, local building codes may require upgrades - new refrigerant standards, electrical changes, venting, or structural modifications to fit a new unit. Many plans don't pay for permits, code-required upgrades or modifications unless you buy a tier that includes them. American Home Shield's ShieldPlatinum, for example, includes permits and code-violation coverage. Without that coverage, the "covered" replacement can still leave you with a large bill.

4. Anything over the cap

Every covered item has a dollar limit. If a repair or replacement costs more, you pay the difference. This is technically not a denial - the claim is approved - but in practice it is one of the biggest sources of out-of-pocket cost. See the next section for how caps compare.

5. Secondary damage

Home warranties generally cover the failed component, not the damage it causes. If a water heater leaks and ruins your flooring, the warranty may replace the water heater, but the floor is a homeowners insurance question (if it's covered at all). The same applies to spoiled food, mold and water damage.

6. Cosmetic issues and non-mechanical parts

Dents, scratches, rust, knobs, shelves, glass, lighting and other cosmetic or non-mechanical parts are commonly excluded, as are items that don't affect the operation of the system.

7. Commercial-grade, oversized or specialty equipment

Commercial-grade appliances, geothermal or solar systems, very large units and some specialty equipment may be excluded or limited. If your home has unusual equipment, confirm coverage before buying.

8. Haul-away and disposal

Removing and disposing of the old unit after a replacement is sometimes excluded or capped.

9. Items outside the main structure

Outdoor plumbing, sprinkler systems, detached garages and guest units are often excluded unless you add specific coverage.

Practical tip: Before buying, open the sample contract for your state and search it for four words: "pre-existing," "maintenance," "code" and "limit." Those four searches will show you most of what can go wrong.

→ Why home warranty claims get denied (and how to avoid it)

A coverage cap (or limit) is the maximum the company will pay for a covered item or claim. Caps come in three forms, and many contracts use all three at once:

• Per-item caps: the most the company pays for a specific item, such as $2,000 for a refrigerator or $5,000 for an HVAC system.
• Sub-limits: lower caps for specific components or situations within an item - refrigerant, ductwork, slab leaks, access through walls or concrete, roof leaks.
• Aggregate caps: the most the company pays across all claims in a contract term, such as $6,000, $9,000 or $25,000 per year.

How caps compare across companies

Caps are reported by third-party reviews and sample contracts and can vary by state and plan year. Always confirm them in the contract for your address.

Why caps matter more than price: a worked example

Imagine a refrigerator's compressor fails and the repair estimate is $1,400.

• Under a plan with a $500 cap, the company pays $500. You pay the service fee plus $900.
• Under a plan with a $3,000 cap, the company pays the full $1,400. You pay only the service fee.

If the low-cap plan saved you $15 a month, that is $180 a year - wiped out several times over by one appliance repair. That is why we weight coverage and contract terms more heavily than price in how we rank companies.

Questions to ask about caps

1. What is the cap for my HVAC system, water heater and each major appliance?
2. Are there sub-limits for refrigerant, ductwork, slab leaks or access?
3. Is there an annual or contract-wide aggregate limit?
4. Does the cap include labor, parts, permits and haul-away, or only some of them?
5. If the company offers cash instead of a replacement, how is the amount calculated?

Reported prices for the seven companies we track

These are approximate figures from company sites, quote flows and third-party reviews in 2025-2026. Your price will differ.

What drives your price

• Plan tier. Systems-only and appliances-only plans are cheapest; combination and premium tiers cost more.
• Location. Prices vary by state and ZIP code, reflecting local labor and parts costs and state rules.
• Home size and type. Larger homes, homes over a certain square footage, and multi-unit properties often cost more. Condos and townhomes can cost less.
• Service fee level. Choosing a higher service fee lowers your premium.
• Add-ons. Each optional item - pool, spa, well pump, septic, second refrigerator - adds to the monthly cost. Reported add-on prices run from a few dollars to around $18 a month each.
• Billing and promotions. Paying annually sometimes unlocks discounts or free months. Promotions are common but usually come with conditions.

Reading promotions correctly

Promotions like "2 months free," "$150 off" or "free roof coverage" are real, but read the condition. Free months typically require paying for the full year upfront. A dollar-off discount may apply only to the first year. The only fair comparison is the total first-year cost and the expected renewal price for the coverage you actually need.

→ Home warranty cost breakdown

The service call fee - also called a trade call fee or deductible - is a flat amount you pay each time the company dispatches a technician for a claim. It is the warranty equivalent of an insurance deductible, with one important difference: it applies per visit, not per year.

Five rules of thumb

1. It's usually per claim, not per item. One visit for one problem means one fee. If the technician finds two unrelated problems, some companies may treat them as two claims.
2. It's often owed even if the claim is denied. At many companies, the fee pays for the diagnostic visit, so you pay it regardless of the outcome.
3. Return visits for the same problem are often free within the workmanship guarantee window (commonly 30 days).
4. You can sometimes choose your fee. American Home Shield offers $100 or $125; First American offers $75, $100 or $125. A higher fee lowers your premium.
5. Multi-year plans may lower it. Some companies reduce the fee for longer commitments.

Choosing a fee: the math

Suppose a company offers two options: a $75 fee with a $55 monthly premium, or a $125 fee with a $47 monthly premium. The higher-fee plan saves $8 a month, or $96 a year. Each claim costs you $50 more. So:

• With one claim a year, the high-fee plan saves $46.
• With two claims a year, it is roughly a wash.
• With three or more claims, the low-fee plan wins.

If your home has several aging systems and you expect multiple claims, a lower fee makes sense. If you're buying mostly for catastrophe protection, a higher fee usually does.

Don't forget the fee when estimating value

A small repair that costs $180 out of pocket saves you only $55-$105 once you subtract a $75-$125 fee. Home warranties deliver their value on mid-size and large repairs, not on minor fixes.

Whether a warranty is worth it comes down to a simple comparison: what you pay in premiums and service fees versus what the company would pay for repairs you'd otherwise fund yourself - adjusted for caps and exclusions.

Rough repair and replacement costs

The table below gives broad national ranges to frame the math. They are rough estimates, not quotes - actual costs depend on your region, equipment and contractor.

Three scenarios

Scenario A: a newer home, one small repair

You pay $50 a month ($600 a year). The dishwasher needs a $300 repair; you pay a $100 fee. Total cost: $700. Without a warranty: $300. Result: the warranty cost you $400.

Scenario B: an older home, one big failure

You pay $55 a month ($660). The furnace's heat exchanger fails and the company approves a replacement within a $3,000-$5,000 cap; you pay a $100 fee and $400 in code-related upgrades the plan doesn't cover. Total: $1,160. Without a warranty, a replacement could run several thousand dollars. Result: the warranty likely saved you a few thousand dollars.

Scenario C: an older home, low caps

You pay $40 a month ($480) for a plan with $500 per-item caps. The refrigerator's compressor fails ($1,400) and the water heater needs replacement ($1,600). The company pays $500 for each; you pay two $75 fees plus $2,000 over the caps. Total: $2,630. Without a warranty: $3,000. Result: you saved $370 - far less than a higher-cap plan would have.

What the scenarios show

• A home warranty is a bet on how many mid-to-large failures you'll have this year. With several aging systems, the odds tilt in your favor.
• Caps decide how much of a big repair you're protected from. A low-cap plan protects you mostly from small and mid-size repairs.
• Exclusions decide whether you're paid at all. A plan with code and permit coverage can be worth far more in an older home.

A simple self-test

A warranty is more likely to be worth it if you answer "yes" to at least three of these:

1. Is your furnace, AC or water heater past about half its expected life?
2. Would a surprise $3,000 repair be a real financial strain?
3. Do you have several older appliances?
4. Would you rather call one number than find and vet contractors yourself?
5. Are you buying a home whose systems you don't know well yet?

→ Is a home warranty worth it? Our shorter decision guide

A home warranty is one of several ways to pay for home repairs. Here is how the main options compare.

Home warranty vs homeowners insurance in one sentence

If a storm destroys your AC unit, call your insurer; if your AC unit simply wears out, that's a home warranty question. Insurance is almost always required by mortgage lenders. A home warranty is always optional, and it never replaces insurance.

The "self-insure" alternative

Instead of paying a $600 annual premium, you could put $50 a month into a dedicated repair account. After a few years without big failures, you'd have a meaningful cushion with no caps, exclusions or claim disputes. The catch: an early major failure can hit before the fund is large enough, and you'll be finding contractors yourself. Many homeowners combine approaches - a warranty while systems are old or unknown, then a savings fund after replacing them.

Builder and structural warranties

If you buy new construction, you may already have a builder warranty covering workmanship and systems for an initial period and major structural defects for longer - 2-10 Home Buyers Warranty is one of the best-known providers of builder structural warranties. Check what that warranty covers before paying for a separate home warranty.

→ Home warranty vs homeowners insurance: full comparison

Strong candidates

• Buyers of older homes. If the furnace, AC and water heater are 10+ years old and you don't know their maintenance history, a warranty can soften a rough first year - especially if the seller pays for it.
• First-time buyers with thin savings. After a down payment and closing costs, many buyers have little cushion. A warranty converts unpredictable repairs into a fixed monthly cost.
• Sellers. Offering a warranty can make a listing more attractive and reduce post-sale disputes. Some plans also cover the home while it's listed.
• Landlords. One number to call for tenant repairs can save time, though contractor availability and response times matter more in rentals. Check whether the company covers rental properties and multi-unit buildings.
• Busy or less handy owners who value not having to find and vet contractors.

Weak candidates

• New or recently renovated homes whose systems are still under manufacturer or builder warranties.
• Owners with a solid repair fund who are comfortable choosing their own contractors.
• Homes with unusual or high-end equipment - commercial-grade appliances, geothermal systems - that plans exclude or cap low.
• Owners who want a specific contractor or brand, since most plans assign technicians and choose replacement models.

Special cases

Condo owners

Your HOA may cover building systems; your unit's appliances and in-unit HVAC may not be covered by anyone. An appliance-only plan can fit well.

Seniors and fixed incomes

Predictable monthly costs can be valuable on a fixed income, but read cancellation terms and avoid long prepaid commitments you might not use.

Homes with known problems

A warranty won't cover problems that already exist. If an inspection flagged an issue, negotiate a repair or credit with the seller instead.

Comparing home warranty companies on monthly price alone is the most common mistake buyers make. Use this checklist instead - it is the same framework behind our ranking methodology.

Coverage

1. Covered items. Does the plan cover every system and appliance you care about, including AC and laundry, which some basic plans leave out?
2. Per-item caps. What's the limit for your HVAC system, water heater and each major appliance? Is it a few hundred dollars or several thousand?
3. Aggregate caps. Is there an annual or contract-wide limit that could stop payments after one or two big claims?
4. Exclusions. How does the contract treat pre-existing conditions, maintenance, code upgrades, permits and haul-away?

Cost

5. Total first-year cost. Premium plus add-ons, after promotions and their conditions.
6. Service call fee. The amount, whether you can choose it, and whether it's owed on denied claims.
7. Renewal price. Ask what the plan will cost at renewal, not just in year one.

Claims experience

8. How claims work. Online, app, phone, 24/7? How quickly is a technician typically dispatched?
9. Contractor choice. Can you use your own contractor, and on what terms?
10. Workmanship guarantee. How long are repairs guaranteed - 30 days, 60, 90?

Trust

11. Reputation and record. Trustpilot and BBB records, complaint patterns, years in business and any regulatory actions.
12. Availability and terms. Is the plan sold in your state? What are the cancellation and refund terms?

Tip: Ratings differ wildly by site. Home warranty companies often score far higher on Trustpilot than in BBB customer reviews, where averages below 2 stars are common across the whole industry. Look at complaint patterns - slow dispatch, denials for maintenance, low cash-out offers - rather than a single score.

Every reputable company publishes a sample contract (sometimes called a sample agreement or terms and conditions) for each state. Reading it takes 20-30 minutes and is the best protection you have. Here is where to look and what to look for.

1. The covered items list

This section lists each system and appliance and, usually, which parts are covered and which aren't. Look for specific language rather than general categories. "Refrigerator: all parts and components that affect operation, except ice makers, water dispensers and their equipment" tells you far more than "Refrigerator."

2. The limits of liability

Often a separate table near the end, this is where caps and sub-limits live. Note every limit for the items you care about most. Check whether limits are per item, per claim, per occurrence or per term, and whether there's an aggregate limit for the whole contract.

3. General exclusions

This section applies to everything. Look for the pre-existing condition clause and how it is worded - does it exclude only conditions that were known or detectable, or any condition that "began" before coverage? Look for maintenance, improper installation, code and permit language, and secondary damage.

4. Item-specific exclusions

Some exclusions appear only under specific items: refrigerant limits for AC, slab leak limits for plumbing, tankless or solar water heater limits, and so on.

5. Replacement terms

Find the language on replacements. Most contracts promise equipment of "similar features, capacity and efficiency," not the same brand or newer technology, and give the company the right to offer cash instead of replacement. Note how cash amounts are calculated.

6. Service fee terms

Check when the fee is owed, whether it applies to denied claims, and how multiple problems in one visit are treated.

7. Waiting period, term and renewal

Confirm when coverage starts, how long it lasts, and whether it renews automatically - and at what price.

8. Cancellation

Look for the refund rules. A common structure is a full refund (minus claims paid) within the first 30 days, then a prorated refund minus a cancellation or administrative fee. State law sometimes caps those fees.

9. Dispute resolution

Many contracts require arbitration and limit class actions. Know what you're agreeing to.

Words that deserve extra attention

Here is a side-by-side snapshot of the companies we review, followed by a short profile of each. Figures are approximate published or reported numbers checked in October 2026.

Choice Home Warranty

Founded in 2008 in New Jersey, Choice sells two plans: Basic (heating, plumbing, electrical, water heater, ductwork and kitchen appliances) and Total (adding air conditioning, the refrigerator, and the washer and dryer). Its $3,000 per-item cap is solid for its price range, and it sells in every state except Washington. The important caveat is its regulatory history: in early 2026 Choice agreed to an $11.8 million consent judgment with the Arizona Attorney General over allegations about claim handling and disclosures, without admitting wrongdoing, and it reached a settlement with New Jersey in 2015. Read the full Choice review or is Choice Home Warranty legit?

American Home Shield

The oldest and largest name in the industry, American Home Shield has sold home warranties since 1971 and is owned by Frontdoor, Inc. Its three tiers - ShieldSilver (systems), ShieldGold (adds appliances) and ShieldPlatinum (adds roof leak repair, an HVAC tune-up and permits/code coverage) - come with some of the highest caps available, up to $4,000 per appliance and $5,000 for HVAC, and a choice of a $100 or $125 service fee. The trade-off is price: ShieldPlatinum is among the more expensive plans we track. Read the AHS review or compare its plans.

Select Home Warranty

Select competes on price, with some of the lowest premiums we track and frequent promotions such as "$150 off, 2 months free and free roof coverage" - usually on annual plans. Its trade-off is coverage: third-party reviews report caps of about $500 per item for many appliances, plumbing and electrical repairs, and about $3,000 per term for HVAC. It's a budget pick for owners who mainly want help with smaller repairs. Read the Select review or Select's real cost.

First American Home Warranty

Part of First American Financial and a fixture at real estate closings, First American offers tiered plans with reported appliance limits of $3,500 on lower tiers and $7,000 on its Premium plan, generous HVAC terms, a choice of service fee ($75, $100 or $125), and one of the stronger Trustpilot records in the industry. It is available in fewer states than most competitors. Read the First American review.

Home Warranty of America (HWA)

Operating since 1996 and owned by Choice since 2022, HWA sells in all 50 states with two consumer plans - Premier (no AC) and Premier Plus - a reported limit of up to $5,000 on most approved repairs, and 13-month contracts. Its 30-day workmanship guarantee is short, and ratings on some review sites are weak. Read the HWA review.

The Home Service Club

The Home Service Club's standout feature is no age limit on covered items, which matters in homes with very old equipment. But its per-item caps are mostly $300-$2,000, an annual aggregate cap of about $6,000-$9,000 applies, and it has no Trustpilot profile, so there is little public review data to check. Read the Home Service Club review.

2-10 Home Buyers Warranty

Best known for new-home structural warranties sold through builders, 2-10 has operated since about 1980 and was acquired by Frontdoor in December 2024. Its consumer home warranty plans start cheap, but its refrigerant limit of $10 per pound and system limits that some reviews put at $2,000 are modest. Read the 2-10 review.

→ See our full ranking of home warranty companies

There is no single best home warranty for everyone. Here's how we'd match common situations to companies, based on the facts above.

Head-to-head comparisons

• American Home Shield vs Choice - higher caps vs simpler, cheaper plans
• Choice vs Select - $3,000 caps vs the lowest promotional prices
• American Home Shield vs Select - premium coverage vs budget plans
• American Home Shield vs First American - two real estate favorites
• Choice vs Home Warranty of America - sister brands with different terms
• First American vs 2-10 - for buyers and sellers

Most home warranty problems are predictable. Watch for these warning signs before you buy.

1. No sample contract before checkout. If you can't read the full terms for your state before paying, walk away.
2. "Covers everything" marketing. No home warranty covers everything. Vague claims usually hide narrow coverage.
3. Caps you can't find. If the limits aren't clearly stated, assume they're low.
4. Promotions without conditions. Free months and discounts are fine - as long as you can see that they require annual payment or apply only to year one.
5. Pressure to prepay multiple years. Multi-year plans can lower costs, but they also lock you in if service disappoints.
6. No clear cancellation terms. You should know exactly what you'll get back if you cancel.
7. A thin or alarming complaint record. Look for patterns in complaints and any attorney general or regulator actions.
8. Unsolicited calls or mailers that look like official notices from your lender or a government agency. Legitimate companies don't need to impersonate anyone.
9. "Home warranty" offers that are really something else - such as utility-line repair plans or single-appliance plans sold as if they were full coverage.

Questions to ask a sales rep

• "What is the cap for my furnace, AC, water heater and refrigerator?"
• "Is there an annual limit on total payouts?"
• "How do you handle code upgrades and permits?"
• "Do I pay the service fee if the claim is denied?"
• "Can I use my own contractor?"
• "What will this cost when it renews?"
• "Can you email me the sample contract for my state?"

There is no single federal regulator for home warranties. They are regulated - or not - state by state, and the level of oversight varies widely.

• Some states regulate home warranty companies through the insurance department. California, for example, licenses "home protection companies" under its insurance laws.
• Some states use other agencies. Texas regulates "residential service companies" through the Texas Real Estate Commission.
• Some states regulate them as service contracts under laws modeled on the National Association of Insurance Commissioners' service contract model act.
• Some states have little specific regulation, leaving general consumer protection law and the contract itself as your main protections.

Why it matters to you

Regulation affects whether a company must be licensed, hold financial reserves, file its contracts, and follow rules on cancellation refunds and fees. It also determines where you complain. A company's terms can differ by state for exactly this reason - which is why a sample contract "for your state" matters.

Regulatory actions: what to check

State attorneys general and regulators do take action against home warranty companies. In 2026, for example, the Arizona Attorney General announced an $11.8 million consent judgment with Choice Home Warranty over allegations about refusing advertised claims and inadequately disclosing exclusions. Before buying, search the company's name plus "attorney general" and "settlement," and check your state regulator's site.

Where to complain

1. The company's formal complaint or escalation process (in writing).
2. Your state's home warranty or service contract regulator - often the insurance department or real estate commission.
3. Your state attorney general's consumer protection office.
4. The Better Business Bureau, which forwards complaints to the company.

The way you file a claim affects how smoothly it goes. These steps reduce delays and avoid the most common reasons for denial.

Before anything breaks

• Save your contract (PDF) and note your plan, caps, service fee and claim phone number.
• Photograph your major systems and appliances - model and serial number plates, the units themselves, and their condition - soon after coverage starts.
• Keep maintenance records in one folder: HVAC tune-ups, filter purchases, water heater flushes, plumbing work.
• If you bought the home recently, keep the inspection report. It can help show an item was working when you took over.

When something fails

1. Stop using it if continuing could cause damage - turn off a leaking water heater's supply, switch off a short-cycling AC. Further damage from continued use can be excluded.
2. Check the basics - breakers, thermostat batteries, filters, pilot lights. A service fee for a tripped breaker is a waste.
3. File promptly. Many contracts require you to report failures within a set time. Waiting can also make a problem look pre-existing.
4. Describe symptoms factually - what happened, when, and what you've checked. Avoid guessing about causes, and don't say a problem has "been going on for months" unless it has.
5. Write down your claim number, the date, and the name of everyone you speak with.

During the technician visit

• Be present and ask the technician what they found and what they're reporting as the cause.
• Ask for the diagnosis in writing or check that it appears in your online claim record.
• Share maintenance records if the technician raises maintenance or age.
• Don't authorize extra work the warranty company hasn't approved unless you're prepared to pay for it.

After the visit

• Follow up if you haven't heard back within the timeframe the company gives, especially if parts must be ordered.
• Get approvals in writing, including the amount covered and anything you'll pay.
• Never pay for a repair before approval unless the company explicitly authorizes it - otherwise you may not be reimbursed.

If no technician is available

In busy seasons or rural areas, a company may struggle to find an in-network contractor. Some will then authorize you to hire your own and reimburse you up to set limits. Get that authorization, and the reimbursement amount, in writing before work begins - and keep every invoice.

→ Quick step-by-step: how to file a home warranty claim

A denial isn't always the final word. Many denials hinge on judgment calls - when a failure "started," whether maintenance was adequate - and can be challenged with documentation.

Step 1: Get the reason in writing

Ask for the specific reason and the contract clause the company is relying on. "Not covered" isn't enough. You want something like "Denied under Section X, pre-existing condition, based on technician report dated..."

Step 2: Get the technician's report

Request a copy of the diagnosis. Denials often rest on a few words in that report, such as "rust," "lack of maintenance" or "unit at end of life."

Step 3: Compare it with the contract

Read the exact clause. Does the contract exclude all pre-existing conditions, or only those that were known or detectable? Is "end of life" or "age" actually an exclusion in your contract? Does the clause apply to this item at all?

Step 4: Gather evidence

• Maintenance receipts and photos.
• Your home inspection report, if the item was noted as working.
• A second opinion from an independent licensed contractor, in writing, about the cause of failure.
• Your claim timeline - when the problem started and when you reported it.

Step 5: Escalate in writing

Send a written appeal through the company's escalation or complaints channel. Keep it short, factual and tied to the contract language.

Sample appeal letter

Subject: Appeal of claim [number] - [item], [address]

I am writing to appeal the denial of claim [number], filed on [date] for my [item] under contract [number].

The denial cites [reason / section]. I believe the claim is covered because [specific reason - for example: the unit was operating normally at the start of coverage, as shown in the attached inspection report dated [date]; the unit was serviced on [date], receipt attached; the cited section excludes only conditions "known to the contract holder," and I had no knowledge of any problem].

I have attached [list of documents]. I request that you reconsider the claim and approve the [repair / replacement] under the terms of my contract. Please respond in writing within [10/14] business days.

[Name, phone, email]

Step 6: Use outside channels if needed

1. File a complaint with your state's home warranty or service contract regulator.
2. File with your state attorney general's consumer protection office.
3. File a BBB complaint, which companies often respond to.
4. Check your contract's dispute-resolution clause; many require arbitration, and some allow small claims court.

Stay factual and keep copies of everything. A calm, documented appeal that cites the contract is far more effective than a phone argument.

When a claim is approved, the company chooses how to resolve it. Understanding the options helps you push for a fair outcome.

Repair

The default. The contractor fixes the item using parts the company approves, up to the cap. If parts are on backorder, ask for an estimated timeline and whether the company will consider replacement after a set wait.

Replacement

If repair isn't possible or economical, the company may replace the item. Contracts usually promise a replacement of "similar features, capacity and efficiency" - not necessarily the same brand, color or a premium model. If you want an upgrade, some companies let you pay the difference. Watch for costs the contract doesn't cover: code-required upgrades, permits, modifications to fit the new unit and haul-away of the old one.

Cash in lieu of repair or replacement

Many contracts allow the company to pay you cash instead. The amount is often based on what the company would have paid through its network - which can be noticeably less than what you'd pay at retail. Before accepting:

• Ask how the amount was calculated and request the itemization.
• Get a retail quote for comparable equipment and installation.
• Check whether accepting cash ends coverage for that item.
• If the offer is far below a reasonable replacement cost, say so in writing and ask for reconsideration.

Partial payments

Sometimes only part of a repair is covered - the failed component but not related parts, or up to the cap but not beyond. Ask for a written breakdown of what's covered, what isn't and why, before work begins, so you can decide whether to proceed, get another quote or appeal.

"Lack of maintenance" is one of the most common denial reasons. A simple routine - and a folder of receipts - protects both your equipment and your claims.

Year-round

• Replace HVAC filters on the schedule your system needs (often every 1-3 months). Keep receipts or photos of the dated filters.
• Keep outdoor AC units clear of leaves, debris and vegetation.
• Run water in rarely used fixtures to keep traps from drying out.
• Clean refrigerator coils and dryer lint traps and vents.

Spring

• Schedule an air conditioning tune-up before the cooling season and keep the invoice.
• Check the condensate drain line for clogs.
• Test the sump pump if you have one.

Fall

• Schedule a furnace or heat pump tune-up before the heating season.
• Test smoke and carbon monoxide detectors.
• Disconnect and drain outdoor hoses and protect exposed pipes in cold climates.

Annually

• Flush the water heater to reduce sediment (or have it done) and check the pressure-relief valve.
• Inspect visible plumbing for leaks and corrosion.
• Check washing machine hoses and replace cracked or bulging ones.
• Clean the dishwasher filter and garbage disposal.

Tip: Some premium plans include an annual HVAC tune-up - American Home Shield's ShieldPlatinum is one. If yours does, use it: it's both maintenance and documentation.

Home warranties are a routine part of many real estate transactions. Here's how they work for each side.

For sellers

• Why offer one: a warranty can make a listing more attractive and reduce the chance of disputes if something fails soon after closing.
• Seller coverage: some real estate plans cover the home while it's listed, so a failure during the sale doesn't derail negotiations.
• Who pays: the seller often pays at closing; it can also be negotiated as a concession.

For buyers

• Coverage usually starts at closing, typically without the 30-day waiting period that applies to direct purchases.
• Check the tier. Sellers often buy a basic plan. Ask whether you can upgrade - for example to add AC, laundry or higher caps.
• The inspection matters. Problems found during inspection are likely to be treated as pre-existing. Negotiate repairs or credits for them rather than relying on the warranty.
• Know the renewal. After the first year, the plan becomes yours to renew or cancel - often at a different price.

For agents

Many agents recommend specific companies. That's fine, but buyers and sellers can choose any company, and comparing caps and exclusions takes only a few minutes.

New construction

Builders typically provide warranties covering workmanship and systems for an initial period and major structural defects for longer - often through providers such as 2-10 Home Buyers Warranty. A separate home warranty adds the most value once builder coverage on systems and appliances expires.

→ Home warranties for buyers and sellers

You're rarely locked in for good, but timing and terms matter.

Cancellation terms to look for

• A free-look period - commonly 30 days - during which you can cancel for a full refund, minus the cost of any claims paid.
• Prorated refunds after that, often minus a cancellation or administrative fee. Reported examples include the lesser of $30 or 10% at Home Warranty of America, a fee of up to one month's payment at American Home Shield and 2-10 (with state-law caps), and a $75 fee in Select's terms.
• Auto-renewal rules - some contracts require written notice a set number of days before the term ends.

Switching without a coverage gap

1. Buy the new plan first and note when its waiting period ends.
2. Cancel the old plan to take effect after the new plan's coverage begins.
3. Request written confirmation of cancellation and your refund amount.
4. Remember that problems that start before the new plan's coverage begins will be pre-existing to the new company.

When switching makes sense

• Your renewal price jumped well above new-customer prices elsewhere.
• You've replaced major systems and need less coverage - or added equipment and need more.
• You've had repeated slow service or disputes with your current company.

Understanding the business model explains almost every clause in a home warranty contract - and helps you predict where friction will come from.

Premiums are pooled

Like insurance, a home warranty works by pooling. Many customers pay premiums; only some file large claims in a given year. The company profits when total premiums and service fees exceed what it pays contractors and for replacements, plus its operating and marketing costs.

Contractor networks lower repair costs

Companies negotiate rates with networks of independent contractors. That's why most plans require you to use the company's technician: a repair that would cost you one price at retail may cost the company noticeably less through its network. It's also why cash-in-lieu offers can feel low - they're often based on the company's cost, not yours.

Caps, exclusions and service fees control risk

Per-item caps and aggregate limits put a ceiling on what any single claim can cost. Exclusions for pre-existing conditions, maintenance and code upgrades keep out the most expensive and least predictable costs. Service fees discourage small claims and offset the cost of dispatching a technician. Waiting periods stop people from buying coverage after something has already broken.

What this means for you

• The company decides coverage, so documentation is your leverage. Maintenance records, inspection reports and written diagnoses are what turn a judgment call in your favor.
• Repair is usually preferred to replacement because it's cheaper - expect repairs until they're clearly impractical.
• Higher caps and broader coverage cost more for a reason. A premium tier with code coverage and high limits shifts more risk to the company, so it's priced higher. Whether that's worth it depends on how old and how expensive your equipment is.
• Reputation reflects how companies handle the judgment calls. Complaint patterns about denials, delays and cash-out offers tell you how a company behaves when a claim is borderline.

A full home warranty isn't the only way to protect against repair costs. Depending on what you're worried about, a narrower product - or none - may fit better.

Extended appliance warranties

Retailers and manufacturers sell extended warranties for individual appliances, often at the time of purchase. They can make sense for one expensive appliance you want covered beyond the manufacturer warranty, but covering many items one by one usually costs more than a home warranty, and each plan has its own terms and claim process.

Utility line repair plans

Utilities and third-party companies often market plans covering water, sewer or gas lines between your house and the street - lines many home warranties exclude. These are a different product. If you receive one of these offers, read what it actually covers and be wary of mailers designed to look like utility bills or official notices.

Credit card purchase protection

Some credit cards extend the manufacturer warranty on items you buy with the card, often by a year. Check your card's benefits before buying a separate extended warranty for a new appliance.

A dedicated repair fund

Setting aside a monthly amount in a high-yield savings account gives you coverage with no caps, exclusions or claim disputes - once the fund has grown. It suits homeowners with newer systems, a financial cushion and trusted contractors.

Builder warranties

For new construction, the builder's warranty usually covers workmanship and systems for an initial period and structural defects for longer. Use it fully before paying for separate coverage.

Choosing between them

Add-ons (also called optional coverage) let you cover items that standard plans leave out. They're only worth buying for equipment you actually have - and only if the add-on's cap is meaningful.

Reported add-on prices come from third-party reviews and company materials; examples include about $8.33 a month for pool and $3.33 a month for a well pump at Select, and roughly $5-$18 a month per add-on at American Home Shield.

A simple rule

Add an item only if a failure would cost several times the annual add-on price and the add-on cap covers a meaningful share of that cost. A $10-a-month add-on with a $500 cap is $120 a year to protect $500 - reasonable for a frequently failing pool pump, less so for equipment that rarely breaks.

Older homes are where home warranties make the most sense - and where contract details matter most, because aging equipment is more likely to fail and more likely to trigger exclusions.

1. Prioritize systems coverage and high HVAC caps

The most expensive failures in older homes are usually HVAC, water heaters and plumbing. A systems or combination plan with a high HVAC cap matters more than appliance extras.

2. Look for code and permit coverage

Older equipment often doesn't meet current code. Replacing it can require venting, electrical, refrigerant or structural changes. A tier that covers permits and code upgrades - such as American Home Shield's ShieldPlatinum - can make the difference between a covered replacement and a large surprise bill.

3. Understand how age is treated

Most contracts don't exclude items for age alone, and some companies - The Home Service Club, for example - advertise no age limit. But older items are more likely to be denied for wear-related causes, rust, corrosion or missing maintenance. Read how the contract treats those causes.

4. Document condition at the start

Photograph equipment, keep the home inspection report, and schedule an HVAC tune-up early so you have a dated record that systems were working when coverage began.

5. Consider what happens after a replacement

Once a covered system is replaced with a new unit, it will often have its own manufacturer warranty. Reassess at renewal whether you still need the same level of coverage.

For landlords, a home warranty's main value is convenience: one number to call when a tenant reports a broken appliance or system. Whether it pays off depends on the property, the company's network and how quickly tenants need repairs.

What to check

• Eligibility. Confirm the plan covers rental properties and, for duplexes or multi-unit buildings, how pricing works - often per unit.
• Who files claims. Some companies let tenants file and schedule directly; others require the owner.
• Service fee responsibility. Decide in the lease whether you or the tenant pays service fees.
• Response times. Habitability rules may require prompt repairs for heat, water and essential systems. If the warranty network is slow, you may need to hire a contractor yourself.
• Tenant-caused damage. Misuse and damage are excluded, so the warranty won't help with tenant-caused breakage.

When it makes sense

Home warranties suit landlords with a few older single-family rentals, limited time to manage contractors, and older appliances. Investors with many units and established contractor relationships often find self-managed repairs cheaper and faster.

Taxes

For rental properties, home warranty costs may be deductible as a business expense. Ask a tax professional.

Myth 1: "A home warranty covers everything in my house."

No plan covers everything. Coverage is limited to the items listed in the contract, the parts specified, and the dollar caps that apply.

Myth 2: "If it's covered, I won't pay anything."

You'll pay the service call fee, plus anything over the cap, plus excluded costs such as code upgrades or haul-away if your plan doesn't include them.

Myth 3: "A home warranty replaces homeowners insurance."

It doesn't. Insurance covers sudden damage like fire and storms; a warranty covers wear-and-tear breakdowns. Your lender requires insurance; a warranty is optional.

Myth 4: "Home warranties are scams."

Home warranties are legal contracts sold by real companies, some of them decades old and publicly traded. Disappointment usually comes from not knowing the caps and exclusions - which is why reading the contract matters. That said, some companies have faced regulatory action, so checking a company's record is part of buying wisely.

Myth 5: "The cheapest plan is the best deal."

A low premium often comes with low caps. One appliance or HVAC repair can cost more out of pocket under a low-cap plan than the premium savings over several years.

Myth 6: "I'll get a brand-new, better unit."

Replacements are typically of similar features, capacity and efficiency - not an upgrade - and the company may offer cash instead.

Myth 7: "I can buy a warranty after something breaks."

Waiting periods and pre-existing condition exclusions exist precisely to prevent that. Coverage has to be in place before the failure starts.

These illustrative examples show how real-world claims typically play out. They're hypothetical, built from common contract terms - your outcome depends on your contract.

Example 1: a dishwasher that won't drain (smooth claim)

A homeowner with a combination plan files online on a Monday. A technician visits Wednesday, finds a failed drain pump, and the company approves the repair. The homeowner pays a $100 service fee; the part and labor (about $300) are covered. Net savings: about $200. A small win - home warranties shine more on bigger repairs.

Example 2: an air conditioner that fails in July (partial coverage)

A 14-year-old AC system stops cooling. The technician finds a failed compressor and recommends replacement. The company approves a replacement within its HVAC cap, but the new system requires code-related changes and a permit that the plan doesn't cover, plus new line sets. The homeowner pays the service fee and roughly $1,200 in non-covered costs. A full replacement out of pocket would have cost far more, so the warranty still saved thousands - but less than the homeowner expected. Lesson: code and permit coverage matter in older homes.

Example 3: a water heater denied for sediment (denial and appeal)

A water heater leaks. The technician notes heavy sediment and rust, and the company denies the claim for lack of maintenance. The homeowner requests the report and the contract clause, then submits receipts showing the heater was flushed the previous year and a home inspection report noting it was working at closing. After a written appeal, the company approves a partial payment toward replacement. Lesson: maintenance records and a written appeal can change outcomes.

Heating and cooling systems are the biggest reason people buy home warranties - and the source of many of the largest disputes. If HVAC is your main concern, focus on these details.

Check the HVAC cap - and the sub-limits

HVAC caps range widely: about $3,000 per term at Select, $5,000 for AC at 2-10 (per its 2025 sample contract), $3,000 per item at Choice, up to $5,000 at American Home Shield, and generous HVAC terms at First American, whose Premium covers 100% of refrigerant costs (lower tiers up to $20/lb). Also look for sub-limits on refrigerant, ductwork, and access (cutting into walls, ceilings or concrete).

Refrigerant changes can raise replacement costs

For the full story - the 2026 EPA rule change, refrigerant limits and how each company covers upgrades - read R-410A phase-out and home warranties.

The refrigerants used in home air conditioners have been changing. Older systems used R-22, whose US production has been phased out. Under EPA rules phasing down HFC refrigerants, new residential systems are moving from R-410A to lower-impact refrigerants such as R-454B and R-32. When an older system fails, a replacement may require a matched indoor and outdoor unit, new line sets or other changes. Ask how your contract handles refrigerant, equipment matching and the code-required parts of a replacement, because those are the costs most often left to the homeowner.

Code upgrades are the hidden HVAC cost

Replacing a furnace or AC can trigger code requirements - venting, electrical work, pads, permits. Without permits and code coverage, the warranty may pay for the unit while you pay for everything required to install it legally. Premium tiers such as American Home Shield's ShieldPlatinum include permits and code coverage.

Maintenance records matter most here

HVAC denials frequently cite missing maintenance. An annual tune-up invoice for heating and one for cooling, plus regular filter changes, is the strongest defense you can have.

Peak-season delays

In heat waves and cold snaps, contractor networks get stretched. Ask how the company handles urgent no-heat or no-cooling situations, and whether it will authorize an outside contractor if its network can't respond in time.

Plumbing

Most systems and combination plans cover leaks and breaks in interior water, drain and gas lines, along with stoppages that can be cleared through an existing access point. The common limits and exclusions:

• Slab leaks (leaks under a concrete foundation) are often excluded or covered only up to a lower sub-limit.
• Access and restoration - opening walls, floors or ceilings and repairing them afterward - is frequently limited, and cosmetic restoration is usually excluded.
• Stoppages caused by roots or collapsed lines outside the home are commonly excluded.
• Fixtures may be covered only for certain parts, such as valves and cartridges, not the fixture itself.
• Rust and corrosion limits apply at some companies - Home Warranty of America, for example, is reported to cover less for rust- and corrosion-related plumbing and electrical repairs.

Water heaters

Tank water heaters are almost always covered on systems plans; tankless and solar units may be limited or excluded. Sediment buildup from lack of flushing is a classic denial reason, so annual flushing - and a record of it - matters. Replacements can trigger code requirements such as expansion tanks, seismic straps in some regions or venting changes, which may not be covered unless your plan includes code coverage.

Water damage is a separate question

If a pipe bursts or a water heater leaks, the home warranty may pay to fix the pipe or replace the heater, but not the damaged floors, walls or belongings. That's a homeowners insurance question, and coverage depends on your policy and the cause.

Appliance coverage is the easiest part of a home warranty to understand - and the easiest place for low caps to bite.

What's usually covered

Refrigerator, oven or range, cooktop, built-in microwave, dishwasher, garbage disposal, and - on most combination plans - the clothes washer and dryer. Some basic plans leave out laundry or the refrigerator; Choice, for example, covers the refrigerator, washer and dryer only on its Total plan, not on Basic.

What's usually excluded

• Ice makers, water dispensers and their lines (unless added).
• Cosmetic parts: shelves, bins, handles, glass, racks and lighting.
• Food spoilage and other consequential losses.
• Countertop and portable appliances.
• Second refrigerators and standalone freezers, unless purchased as add-ons.

Caps and replacement value

Appliance caps run from about $500 per item at the low end to $2,000-$4,000 per appliance at American Home Shield and up to $7,000 on First American's Premium plan. If you own high-end appliances, a low cap may cover only a fraction of a replacement, and "similar features, capacity and efficiency" replacements may not match premium brands.

Manufacturer warranties come first

New appliances typically carry a manufacturer warranty for at least the first year. While that warranty is active, it - not your home warranty - should handle defects. Keep purchase receipts with your home warranty paperwork.

It depends on your home and priorities. In our rankings, Choice Home Warranty is our top pick for value, with two simple plans and a $3,000 per-item cap. American Home Shield offers the highest caps and broadest top-tier coverage, including permits and code upgrades. Select is the lowest-cost option but has low per-item caps. Compare caps and exclusions, not just price - see the full rankings.

Yes. You don't need to be buying or selling a home. You can buy a plan directly from most companies at any time, though a 30-day waiting period usually applies before coverage starts, and problems that already exist won't be covered.

Usually only as an add-on or on a premium tier, and only for limited leak repair - not roof replacement. American Home Shield's ShieldPlatinum includes roof leak repair up to $1,000; Select often includes roof leak coverage in promotions with a low cap; Choice offers roof leak coverage as an add-on. Storm damage to a roof is a homeowners insurance question.

Most companies cover items regardless of age as long as they were working properly when coverage began and have been maintained - The Home Service Club specifically advertises no age limit. In practice, older items face more denials for wear-related causes, pre-existing conditions or maintenance, so documentation matters more as equipment ages.

Usually not in the first years. New homes typically come with builder warranties, and new appliances and systems carry manufacturer warranties. A home warranty becomes more useful once those warranties expire and major equipment starts aging.

Sometimes. Most companies assign a technician from their network. Some allow you to use your own contractor, typically with approval before work starts and reimbursement up to set limits. American Home Shield, for example, requires prior "outside authorization." Ask before you buy if this matters to you.

Simple repairs can be completed within days of filing. Claims that need parts, replacements or approvals can take longer - sometimes weeks - especially during peak seasons. Delays waiting for parts are a common complaint across the industry. Following up in writing and asking for timelines helps.

Usually not. At many companies, the service call fee pays for the diagnostic visit and is owed regardless of whether the claim is approved. Check your contract's service fee section before you file.

Generally no. Most contracts exclude problems that existed before coverage began, though some cover pre-existing issues that couldn't have been detected through a visual inspection or simple mechanical test. Read the exact wording in your contract, and keep inspection reports and maintenance records to help show items were working at the start of coverage.

For a primary residence, generally no - it's a personal expense. For a rental property, a home warranty may be deductible as a business expense. Tax rules depend on your situation, so check with a tax professional.

Many companies offer coverage for rental properties and some multi-unit buildings, though terms and prices may differ from owner-occupied homes. Confirm that the plan allows rentals, how tenants file claims, and whether multi-unit properties are priced per unit.

Many home warranty contracts can be transferred to the new owner, which can be a small selling point; others can be cancelled for a prorated refund. Check your contract's transfer and cancellation sections, and tell the company about the sale in writing. If you're buying a home with an existing plan, ask the seller for the contract so you know what's covered and when it renews.

Usually only as optional add-ons. Well pumps, septic systems, sump pumps, pools and spas are rarely included in standard plans, but most companies sell them as extras for a few dollars to around $18 a month each. Check the add-on's cap and exclusions - septic pumping, well drilling and pool heaters are commonly limited or excluded.

Often, on combination or premium plans. Garage door openers appear on many comprehensive tiers - Select's Platinum Care and First American's Essential tier include them, for example - but the door itself, springs, tracks and remote transmitters may be excluded or limited. Confirm in the covered-items list for your plan.

Most contracts don't limit the number of claims, but every claim carries a service call fee, and per-item and aggregate caps limit how much the company will pay in total. A plan with an annual aggregate cap - such as The Home Service Club's reported $6,000-$9,000 or 2-10's reported $25,000 - can stop paying after a few large claims in the same year.

Before you buy any plan, run through this list:

1. List the systems and appliances you care about and their approximate ages.
2. Choose the tier that covers them - systems, appliances or both.
3. Download the sample contract for your state.
4. Write down the caps for your HVAC, water heater and major appliances, plus any aggregate limit.
5. Read the pre-existing condition, maintenance and code/permit clauses.
6. Compare the total first-year cost, including promotions' conditions and expected service fees.
7. Ask for the renewal price.
8. Check the company's complaint record and any regulatory actions.
9. Note the waiting period, cancellation terms and renewal date.
10. Set up a folder for the contract, photos, inspection report and maintenance receipts.

→ Compare the best home warranty companies

This guide was written by the Top Home Warranty editorial team using each company's published plans, sample contracts and terms; regulator and attorney general releases (including the Arizona Attorney General's 2026 Choice Home Warranty settlement); public company filings (including Frontdoor, Inc.'s acquisition of 2-10 Home Buyers Warranty); and third-party reviews and customer records. Prices and caps are approximate figures checked in October 2026 and vary by state, ZIP code, plan and date. Repair cost ranges are broad national estimates intended only to frame decisions.

We may earn a commission from some links on this site. That never changes the facts we report - caps, exclusions, fees and ratings are stated the same way for every company. See how we rank and our editorial policy.

This guide is general information, not legal, insurance or financial advice. Home warranties are service contracts whose terms vary by company and state; your signed contract determines what is covered. Always read the full sample contract and confirm current terms with the company before you buy.