Home Insurance vs. Home Warranty – What Do You Need?

By TheSph3r3 Archive, Home Insurance Comments Off on Home Insurance vs. Home Warranty – What Do You Need?

a home insurance policy

The difference between a home warranty and homeowners insurance.

Purchasing your first home is a great achievement. Transitioning from renting to owning comes with new and unexpected expenses, such as homeowners insurance and a home warranty policy. Since these two policies sound alike and both provide home protection, it’s natural for many homeowners to think they are interchangeable. However, this isn’t the case. A home warranty and home insurance policy cover different items, and it’s important to understand the differences.

Home Warranty

A home warranty is essentially a service contract. They often cover repair or replacement of system components and appliances that might fail due to standard wear-and-tear or age. For example, your washer/dryer might stop working a couple of weeks of being in your new home. Your HVAC might fail next summer. Fixing or replacing these large appliances can take its toll on your finances, which is where a home warranty comes into play.

A home warranty can be especially useful for homeowners who have purchased these big-ticket items for their new property. A typical policy can cover the repair or replacement of your air conditioner, kitchen appliances, electrical and plumbing repairs. If you have a swimming pool, you can get policies that cover the mechanical parts. Keep in mind that while this coverage is useful, it is not legally required.

Homeowners Insurance

Homeowners insurance, on the other hand, may be required of homeowners that purchase their property with the help of a mortgage. The lender will often require the homeowner to purchase home insurance in order to protect their investment. This is because home insurance helps to repair your home or replace your personal property after a covered event, such as theft, fire, windstorms, hail, vandalism, and more. A home insurance policy will not provide help if, for example, your air conditioner breaks down from wear and tear or is defective.

Homeowners insurance comes with liability coverage, which helps to pay for legal fees and medical bills if you are found responsible after a visitor is injured at your home.

A home warranty and homeowners insurance policy offer different types of coverage that give you peace of mind as you consider certain scenarios. The professionals at Reata Insurance Group serve Lakeway and the entire state of Texas with reliable home insurance that you can trust. Contact our helpful team to get started today.

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