When we talk about home systems and appliances, we all know that nothing lasts forever. While it hurts to accept this, even our most essential appliances we depend on have a limited lifespan. No matter how expensive and durable they are, appliances are still prone to aging and normal wear and tear.
Most homeowners set aside a budget for routine home maintenance, but not all save up for unexpected replacements and repairs. This is where home repair insurance comes in that serves as safety nets when appliances break down.
Most people are familiar with home insurance that covers major incidents, such as hail and fire. But have you heard about home repair insurance? This type of insurance covers specific damages around the house that result in constant wear and tear. It commonly covers damages on indoor plumbing, mechanical items, wiring systems, appliances, and HVAC units.
If you’re planning to apply for home repair insurance, it’s important to learn what it means and how it can affect your finances as a homeowner.
What is home repair insurance?
Home repair insurance is an optional service agreement covering the cost of repairs and replacements for household appliances and systems. It serves as additional protection for essential home items that unexpectedly break down because of normal wear and tear.
Most of the coverage found in home repair insurance is not included in the standard homeowners’ insurance. As part of the policy, the insurance provider offers the client a network of trained and pre-screened contractors to conduct the repairs and replacements for the broken items. This will save homeowners a lot of time instead of searching for reputable contractors around the area.
Home repair insurance features various types of coverage. Insurance providers may offer three plans, including the electrical and plumbing, appliances, and a combination of both. Other providers may cover both systems and appliances, including base plans or a bigger coverage for premium plans.
Repair insurance can cover services for plumbing, electric appliances, HVAC systems, and utility lines, such as sewage, gas lines, electrical lines, and water pipes. A provider may also offer add-on coverage for those who want a customized protection plan. Additional coverage includes a pool and spa, central vacuum, additional HVAC system, water heater, extra fridge, and other additional appliances.
How much does a home repair insurance cost?
Generally, a home repair insurance plan ranges between $30 to $70 each month. But the monthly premium can be lower or higher based on some factors.
The size and location of the home will affect the insurance rate. Since providers cover many states, regulations and tax laws will drive the price lower or higher. Larger properties with an additional guest house may also incur a bigger monthly premium.
The service cost is a predetermined fee for the technician during repairs. The typical service cost is between $75 to $125. Some providers may offer other options, such as paying for a higher service cost to lower the monthly premium. The client may ask the provider if they charge for additional service costs if the issue persists.
Plans also include coverage caps, which refer to the amount the provider will pay for the covered items during the insurance term. If you went over the full cost of a repair or replacement, you need to pay the exceeding amount.
Insurance costs may also depend on the number of coverage exclusions. This refers to systems and appliances the provider will not cover. Pre-existing conditions and weather-related incidents aren’t usually included in most plans.
Do you need home repair insurance?
Applying for home repair insurance has its advantages and drawbacks. To know if you need home repair insurance, create a detailed inventory of your home systems and appliances, including their ages.
Compare the age of the most expensive appliances and systems to their average lifespan. Make sure to have complete records of previous purchases for each item. If most items are about to reach their maximum life expectancy, consider signing up for home repair insurance.
Otherwise, if the appliances and systems are still new, it’s best to put off the insurance. New houses usually include a one-year warranty for home systems, such as electrical and HVAC systems, while excluding household appliances.
Repairs, renovations, and improvements can be expensive, but investing in the efficiency of your home will outweigh these costs. Suppose you’re planning to apply for home repair insurance, research and ask for free quotes from reputable insurance firms to find the best coverage at affordable rates. A home repair insurance isn’t always worth the cost, so make sure to know it will affect your finances.
Meta title: Should You Apply for a Home Repair Insurance?
meta desc: Home repair insurance offers a solution for home systems and appliances that need proper fixing. Find out if applying for home repair insurance works for you.