Are Home Insurance and Home Warranties The Same?

Home warranty and home insurance can provide coverage to safeguard your house and pocket if something goes wrong. But they are not the same. Understanding the difference between home insurance and a home warranty can help you determine what’s covered and what’s not. So, if something unexpectedly gets damaged, you’ll know what to expect from the policies.

In this detailed article, we’ve covered all your doubts about home insurance and home warranties. Keep reading to find answers!

Home Insurance Vs. Home Warranty: At A Glance

Home warranties and homeowners insurance policies are the two key ways for the highest degree of protection for your property and its items. Both cover repair and replacement costs of specific or covered items or fixtures of your house if they break down or get damaged. Look at the table below for a quick analysis of both policies.

Homeowners Insurance Home Warranty
An insurance policy protects against properties’ structural damage and natural disasters. Warranty Plan that covers repair & replacement costs of covered items that break down due to normal wear and tear.
Required to purchase Optional (Anyone can purchase)
Services fee and premiums are required Premiums and deductibles are required
Covers: home structure, liability protection, etc, Covers: home systems and appliances

What Is A Home Warranty?

A home warranty policy is a protection plan for your home systems and appliances and pays for the repair and replacements upto a specific limit. A home warranty plan typically lasts for 12 months, after which you have the option to renew it.

Specific state governing bodies regulate each home warranty company. Your home warranty contract does work like insurance, but legally it is NOT. The key difference between home insurance and a home warranty is that the latter only covers systems, appliances, and a few extra items of your house.


Generally, home warranty companies offer three types of warranty plans:

  • Appliance Coverage Plan (Covers appliances only)
  • System Coverage Plan (Covers systems only)
  • Combo Plan (Covers both systems and appliances)

The following appliances and systems are generally covered:

Built-In Systems

  • Heating
  • Plumbing
  • Air Conditioning
  • Ductwork
  • Water Heater’
  • Stoppages


  • Microwave
  • Oven/Cooktop/Range
  • Refrigerator
  • Dishwasher
  • Clothes Washer & Dryer
  • Garbage Disposal

Apart from these items, home warranty plans also extend coverage to add-ons which you can include in your plan for a few extra dollars. These additional items can be:

  • Pool/Spa
  • Sump Pump
  • Well Pump
  • Limited Roof Coverage
  • Second Systems Or Appliance


The cost of a home warranty varies depending on the chosen plan, area of residence, additional items, size of your property, and amount of deductible. The average premium of a home warranty plan can range between $39 to $80 monthly and upto $1,000 annually.

Besides monthly and annual premiums, companies also charge a service fee or deductible. This amount can be anywhere from $60 to $125 and you are required to pay it during each service visit.

How Does It Work?

You can start filing for claims once the waiting period is over. It is usually 30 days from the date of purchase of the warranty plan. So, if any of your covered items break down, you can submit a service request to the company after this time. The procedure to do so will be mentioned in your service agreement. However, generally, this is how it works:

  • Call the customer service company or visit the company’s website and submit the request.
  • A customer service representative will process your request, and a technician will be assigned to you.
  • As per your convenience, the technician will arrive at your doorstep, diagnose the problem, and suggest a suitable solution.
  • If your device needs repair, the technician will fix it. Otherwise, you will get a replacement according to the company’s terms.
  • In the end, you must pay the technician the deductible amount mentioned in your contract.

Note: To find a suitable home warranty company, we advise you to read home warranty reviews, understand the fine prints, and research the shortlisted companies thoroughly before finalizing.

What Is Home Insurance?

Home insurance is a sort of coverage that guards against losses and damage brought on by disasters. Several standard policies also include personal property and accidental damage liability coverage up to a specific limit.


The Insurance Information Institute states that a typical homeowners insurance coverage must consist of the following:

  • Structure of the home
  • Liability protection
  • Personal belongings
  • Extra living expenses

Homeowners insurance provides broad coverage against the damage caused due to:

  • Explosion
  • Smoke
  • Vehicles and aircraft
  • Vandalism
  • Theft
  • Falling object
  • Fire and lightning
  • Volcanic eruption
  • Electric current
  • Freezing of any household appliances

NOTE: Your home insurance may cover more damages; we recommend reading the agreement thoroughly to learn about the exact coverage.


The total cost of a home insurance policy can depend on your area of residence, the value of your belongings, history of your home insurance claims, size, and conditions of your property. However, according to the Insurance Association, the average cost of annual premiums has to be upto $1,200 or $105 monthly.

Homeowners’ insurance companies also charge deductibles ranging from $500 to $2000.

How Does It Work?

Here’s an overview of the general procedure for filing claims with a homeowners insurance company:

  • Notify the insurance company as soon as possible about the damage.
  • Take photos of the damage, note the extent of the damage, and so on.
  • Cooperate with the company on any requirements, such as inspections, recorded statements,
  • Upon approval, the insurance company may offer you the money at once or in multiple checks or bank transfers over time.

The Bottom Line: What Should You Get?

Let’s face it: life happens, and your valuable things can break down. Whatever the differences between home insurance and a home warranty, having both services can help you save on pricey repairs and replacements. However, before buying either, read and understand the fine prints thoroughly to avoid surprises if something does not go your way.

Sandra Johnson

Sandra Johnson

Sandra Johnson was a few years out of school and took a job as a life insurance agent in California, selling coverage door-to-door for Prudential. The experience taught her about the technical components of insurance and its benefits for individuals and society, as well as the misunderstandings people often have about insurance. She has over ten years’ experience in the insurance industry, having worked as both a Broker and Underwriter, assisting clients across a broad range of industries. At Insurance Noon, Sarah diligently gathers all the required information and curates up pieces to provide meaningful insurance solutions. Her personal value proposition is to demonstrate a genuine interest in always adding value for clients.Her determined approach to guiding clients has turned her into a platinum adviser to multiple insurers.