Understanding the Difference Between Home Warranty and Homeowners Insurance

As a homeowner, you need to protect yourself from all types of loss, not just what is covered by your insurance policy. This is where having a home warranty can be advantageous. Understanding what both types of coverage offer is important so that you don’t get caught having to pay for massive repairs to your home or belongings. Take a few minutes to talk to your insurance agent. If your home is brand new, it may benefit you to talk to your building contractor as well.

Benefits of a Home Warranty

A home warranty is similar to the warranty you have on your car or appliances. Warranties are designed to cover the cost of replacing any items in your home that were defective or installed improperly. Home warranties cover the workmanship involved in building your home. They ensure that your appliances and other systems remain in good working order. With a home warranty in place, you are covered if one of your appliances, heating/cooling, or plumbing systems breaks down or malfunctions in any way. Keeping a home warranty in place ensures that repairs can be made at an affordable price and without breaking your budget.

The Purpose of a Homeowners Insurance Policy

The purpose of a homeowners insurance policy is to protect you if your home is damaged by unforeseen events like hurricanes, tornadoes, and fire. A homeowners policy will pay for repairs that are caused by events that are beyond your control. This includes partial repairs as well as replacing your home if it happens to be totally destroyed by a fire or other event. You need to understand the difference between fair market value and full replacement value. This policy protects you from damages caused by outside events, not simply wear and tear or technical malfunctions. It also covers theft and vandalism.

The Benefits of Having Both

There are distinct benefits of having both types of protection. While the warranty provides protection to your home’s interiors by covering the internal working parts if they break down or malfunction, your home insurance also covers external damages caused by natural disasters such as storms and fire. With both types of coverage, you are fully protected from most types of loss, including theft and vandalism. The financial loss that you have to recover from can be staggering if you experience either type of devastating event. With both types of coverage, you are able to rest easy no matter what circumstances you experience over time.

As a homeowner, you want to take every opportunity you can to ensure your home is fully protected in every way. Having a homeowners insurance policy as well as a home warranty in place provides you with the coverage you need to make sure you won’t have to come up with the money for repairs out of pocket. While you aren’t required to carry both types of coverage, it is extremely beneficial that you do so. At Advanced Insurance Group, you can speak to our experienced agents who are committed to providing you with the best possible services at all times.

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