Updated May 2021
Insurance and warranty coverage are some of those extra duties. While you certainly need to protect your home’s vital appliances and systems (such as washing machines, refrigerators, HVAC systems, and plumbing),what’s the best choice when it comes to home warranty vs. manufacturer warranty?
What appliances should you cover, and which of these warranties fits your situation best? Let’s clear up the subtle yet vital differences between these options to help you decide.
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Explaining the Original Manufacturer Warranty
Manufacturer warranties are more limited than a full-coverage plan. First, they usually cover only a single home appliance because they come from the company producing the item, known as the original equipment manufacturer, or OEM.
Also, they typically last only a year, but you can prolong it by buying an extended warranty on appliances. Extensions are available from the OEM or the third-party store selling the device.
Another limitation is that such a warranty only covers the original owner’s purchase. If you inherit the device from a second-hand user, you will likely not have access to the coverage.
Explaining the Home Warranty
As its name suggests, a home warranty covers multiple appliances and systems against wear and tear damages that occur after installation. Coverage may apply regardless of an appliance’s previous owners, and every company has its own policy regarding pre-existing conditions.
Home warranties are significantly different from OEM warranties and home insurance, the latter of which exists to defend against large disasters like house fires or natural disasters. Keep these differences in mind when deciding on a home warranty vs. an appliance extended warranty.
Will I Still Need One If My Home Is New?
Every home, even a brand new construction, has a chance of suffering a system breakdown at some point. Older appliances especially may require some kind of repair or replacement while you own the property. Perhaps the construction team accidentally damage a component during installation, or maybe the appliance wasn’t working out of the box.
Home warranties are an excellent option for streamlining the “first-time” experience of owning a new home.
Making the Decision: Home Warranty vs. Appliance Warranty
Generally, you can think of OEM warranties as “short-term” coverage that protects against initial problems and installation errors. Home warranties are blanket coverage agreements that protect all your systems during your ownership period.
Ask yourself these questions when considering multiple warranty offers:
- What appliances and systems do you want to cover, and which ones can you afford to leave out?
- What is your budget? Can you afford the deductibles if there are any? Would paying for a full replacement upfront work out for you?
- What’s your ideal coverage period? Are you okay with a year, or do you need to think seriously about a warranty vs. an extended warranty?
What’s the Difference Between a Manufacturer’s and Home Warranty?
The purpose and meaning of manufacturer’s warranty coverage and home warranty coverage differ significantly. A manufacturer’s warranty is usually provided free of charge when a consumer buys a major home appliance. For a limited time—it could be 90 days or five years or more—the manufacturer will pay for an item’s repair or replacement if it fails as a result of a factory defect or poor workmanship. Appliance companies provide documentation to help consumers know exactly what is covered in manufacturer’s warranty agreements.
A home warranty is a service agreement from a third-party provider, so it is not limited to a specific appliance or even a specific brand. Homeowners can purchase one warranty and receive appliance warranty coverage for a range of home equipment.
Which Warranty Should I Choose?
Consumers don’t necessarily need to choose between manufacturer’s coverage and third-party home warranty coverage. Consumers most often receive manufacturer’s coverage automatically when purchasing a new appliance. That coverage is limited, however. It expires after a certain amount of time and does not necessarily cover all scenarios that could result in a broken appliance.
Consumers could purchase a third-party policy while the manufacturer’s coverage is still active, but this could result in redundant protection. It usually makes more sense to wait until the manufacturer’s coverage has expired and then purchase extended coverage from a company such as Liberty Home Guard.
Our Suggestion and Why Liberty Home Guard Should Be On Your List
We strongly recommend investing in home warranty coverage while possibly keeping some OEM agreements on individual appliances in case.
Insurance, OEM support, and home warranties often work hand-in-hand. Do you have any questions regarding this topic? Want to know how you can get coverage soon? Interested in learning what the duration of a home warranty’s coverage is? Get in touch with Liberty Home Guard today.