Home Warranty vs. Home Insurance

Although they both help protect homeowners from unexpected costs, home warranties and home insurance cover very different things.

Feature	Home Warranty	Home Insurance
Purpose	Covers repairs or replacement of home systems and appliances due to normal wear and tear	Covers damage to your home and belongings from covered events like fire, storms, theft, or vandalism
Covers	HVAC, plumbing, electrical, water heater, kitchen appliances (depending on the plan)	House structure, personal property, liability, and additional living expenses if your home becomes uninhabitable
Doesn't Cover	Damage from accidents, natural disasters, neglect, or pre-existing issues	Normal wear and tear, appliance breakdowns due to age, or maintenance issues
Required?	Optional	Usually required by mortgage lenders
Cost	Annual premium plus a service fee for each claim	Annual or monthly premium, with a deductible when filing a claim

Home Warranty

A home warranty is a service contract that helps pay for repairs or replacements when covered systems or appliances fail due to everyday use.

Best for:

• Older homes with aging appliances

• First-time homeowners

• Budgeting for unexpected repair costs

Home Insurance

Home insurance protects you financially if your home or belongings are damaged by covered events such as:

• Fire or smoke

• Windstorms and hail

• Lightning

• Theft and vandalism

• Certain types of water damage

Most policies also include personal liability coverage if someone is injured on your property and may cover temporary living expenses if you can't stay in your home during repairs.

Which One Do You Need?

Many homeowners choose to have both:

• Home insurance protects against major disasters and liability.

• Home warranty helps reduce the cost of repairing or replacing everyday household systems and appliances.

Using both provides broader protection by covering different types of risks and expenses.