When Home Warranties Expire and Cease to Function

A home warranty is similar to insurance in that coverage is not indefinite—it expires after a time. Homeowners who want to continue protecting their property with warranty coverage might wonder when and how they should arrange for a policy renewal.

So, how long do warranties last? It could be months to years, depending on the specifics of the policy. This guide will unpack the question by providing a thorough summary of how home warranties operate, including what to expect when it comes to policy duration, renewal processes, and waiting periods.

What is Home Warranty Coverage?

A home warranty is a contract between a policy holder and provider to support the repair and upkeep of essential home equipment. The policy holder—typically a homeowner—pays a monthly or yearly premium in return for coverage. This premium is primarily determined by the breadth of coverage and number of items and services included in the policy.

If a covered item breaks down or otherwise requires service, the policy holder can submit a claim and nominal service fee. The warranty provider will then arrange for a professional technician or home service professional to attend to the issue per the policy’s stipulations.

Just as health insurance can mitigate expensive medical costs, this structure offers homeowners protection from unexpected and pricey repairs to home appliances and systems.

What Does a Home Warranty Cover?

Home warranty coverage can be quite expansive, with coverage options spanning a few broad categories.

• Appliances Traditional home warranties cover standard home appliances, such as refrigerators, ovens, stovetops and ranges, dishwashers, washing machines, and dryers—the home equipment that is as essential as it is expensive. Other appliances may be eligible for coverage as well, from garbage disposals and ice makers to ceiling fans and electronics.

• Systems Home systems protection is also a key feature of the average home warranty. Coverage typically extends to the mechanical components essential to the functioning of a home’s plumbing, HVAC, and electrical systems.

• Structures and Fixtures Coverage of a home’s roof, foundation, and general structure is usually handled by homeowner’s insurance, but some warranty policies offer protection against roof leaks. Warranty coverage may also apply to internal plumbing and lighting fixtures.

• Home Services It’s not always about equipment repair. Modern warranty companies may offer a suite of home services to support general maintenance and upkeep. These services can include gutter cleaning, carpet cleaning, powerwashing, window washing, rekeying, and pest control.

Key Limitations of Home Warranty Coverage

It’s always advisable for homeowners to work closely with reputable home warranty providers to craft comprehensive plans that suit their homes, needs, and lifestyles. Establishing the ideal policy is easier when the property owner has realistic expectations and a thorough understanding of what home warranties can and can’t do. Here are some things to keep in mind:

• A home warranty is not homeowner’s insurance.

A home warranty is meant to cover repair or replacement costs when home equipment fails due to general wear and tear. A warranty does not apply when a piece of equipment is stolen or damaged in a fire, storm, or other accident. This is typically where homeowner’s insurance kicks in.

• A home warranty is not the same thing as a manufacturer’s warranty.

There are important differences between a home warranty and a manufacturer’s warranty. A manufacturer’s warranty is a guarantee that a product will function as advertised. For a limited time, the manufacturer will repair or replace the equipment, usually at no cost, if an issue arises from a factory defect or poor workmanship. A home warranty, on the other hand, is a service contract that policy holders pay for. Home warranty coverage on an appliance may be unnecessary when the manufacturer’s warranty on the appliance is still valid.

• Warranties do not always cover equipment with preexisting conditions.

Warranties are designed to protect functioning appliances and systems that may fail after years of average use. It can be much harder to find coverage for an item that is already nearing the end of its lifespan.

• Warranty policies may include coverage caps and exclusions.

Most warranties stipulate limits on how much the provider will expend when equipment needs to be repaired or replaced. If a coverage cap is set at $2,000, for example, but an appliance replacement costs $2,500, the policy holder is responsible for the $500 difference. Homeowners should be clear on their coverage caps before agreeing to a policy.

Most policies also include coverage exclusions. Refrigerator coverage, for example, might protect the full refrigeration system but not disposable water filters. Again, homeowners should note all exclusions before signing a contract.

• Warranties may have a waiting period before coverage kicks in.

Reputable home warranty companies don’t usually guarantee coverage immediately upon signing. The waiting period for home warranty coverage may last for anywhere from 30 to 60 days, and during this time homeowners are unable to submit claims for service. This policy is meant to mitigate abuse and prevent bad actors from making claims on equipment known to be in a state of disrepair.

• Home warranties do not remain active indefinitely.

The duration of home warranty coverage is finite and determined when the policy holder and provider agree on a contract. Homeowners should be mindful of when a warranty is due to expire and negotiate a renewal accordingly to avoid lapses in coverage.

Can You Purchase a Home Warranty at Any Time?

Home warranties are generally available for purchase at any time. It’s common for homeowners to secure a warranty when moving into a new home. Because some warranties are transferable when property changes hands, homeowners anticipating a home sale in the near future also commonly purchase warranties to entice buyers. But even homeowners who have lived in the same home for years and have no plans to move can purchase warranty coverage for themselves.

There might be some restrictions on adding coverage or changing the terms of coverage when a policy is already active, but that is subject to the nature of the policy and provider.

When Does Home Warranty Coverage Stop Working?

How long do home warranties last? It depends on the contract the policy holder has agreed to. A warranty’s effective dates are stipulated at the time of signing. Coverage duration can vary from company to company, but one-year and multi-year contracts are most common. Many companies allow for premiums to be paid for in yearly or monthly installments.

A warranty ceases to provide coverage on the date specified in the contract. So if the warranty is active through December 31, the homeowner can no longer make a claim to repair or replace any equipment starting January 1. The homeowner could purchase a new contract on January 1, but that could create a lapse in coverage, especially considering the waiting period, and it could be March before the homeowner is again eligible to submit a claim.

It’s easy to avoid coverage lapses, however. As your prescribed coverage period draws to a close, you can reach out to your provider to renew or extend your contract. In all probability, your provider will issue a renewal notice ahead of time to ensure you can maintain active coverage with no lapses or gaps. 

When you’re due for a policy renewal, take stock of your current needs. Since you signed your last contract, maybe your refrigerator aged out of its manufacturer’s warranty and will now require protection under your home warranty. Maybe you’re not up for as much do-it-yourself maintenance and want to include gutter cleaning and window washing on your policy. Perhaps you no longer need garbage disposal coverage after that kitchen remodel. Reassess your home and work with your provider to create a mutually beneficial policy.

Maximizing Your Home Warranty Benefits

Knowing the ins and outs of your home warranty policy will help you take the greatest advantage of its benefits. Ensure that you maintain active coverage, and be mindful of any coverage caps, exclusions, and fees.

It also pays to be on top of your home maintenance. When a covered appliance or system develops an issue, file a claim immediately to have it resolved before the problem compounds into something more severe. If your policy allows for a yearly or biyearly gutter cleaning, use it! Careful attention to your home’s upkeep will allow you to get the most out of your policy and home equipment alike.

So, if your existing policy is up for renewal or if you’re looking to purchase a policy for the first time, call the Liberty Home Guard team at (866)-700-5422. We’ll get moving on the policy that’s in your best interest.