Home Warranty or Manufacturer Warranty: What's the Difference?

A lot of new homeowners might think that, because their appliances and house are new, they won't have to deal with malfunctions or appliances breaking down. Who thinks about repairs for items that are brand new?

Unfortunately, just because something has never been used before or is newly manufactured doesn't mean that it's not a lemon. Everything nowadays is subject to fail right "out of the box," so to speak, and even if that likelihood is small, homeowners should prepare for it — especially because when a home system or appliance does fail, it tends to fail at the most unexpected and inconvenient time. Whether your house is brand new or one you've been living in for some time, Murphy's law can really get you when you're most vulnerable.

There are multiple ways that homeowners can protect themselves. While many appliances will be covered under a manufacturer's warranty, a home warranty can offer different types of coverage, different types of solutions, and more complete protection from spontaneous disaster.

What is a Home Warranty and What Does It Cover?

A home warranty is designed to protect your home systems and appliances from breakdowns caused by normal wear and tear. It's important to note that this is not homeowner's insurance, though it does work well in conjunction with it. For example, let's say your plumbing springs a leak, getting water everywhere and damaging the floor and carpets. While homeowner's insurance would cover the water damage, it doesn't always cover the cost of repairing or replacing all the plumbing — that's where the home warranty comes in.

Home warranties can cover a variety of systems and appliances, including, but not limited to:

• Air Conditioning & Heating (including ductwork)
• Electrical
• Plumbing
• Water Heater
• Garbage Disposal
• Washer and Dryer
• Dishwasher
• Garage Door Opener
• Refrigerator

It's important to realize that home warranty coverage may vary state by state, and it's up to you to understand what your home warranty covers and what it doesn't. To learn more, view sample coverage terms on our costs and coverage page, and you can always contact HWA to speak with our customer service team about coverage details.

What's the Difference Between a Manufacturer's and Home Warranty?

A manufacturer's warranty will generally offer repair, service, and sometimes replacement of the specific appliance that it's attached to. The original equipment manufacturer (OEM) will usually honor these warranties for one year after the date of purchase (unless you end up buying an extended warranty), and most will cover parts and labor for the faulty appliance. One important point: manufacturer's warranties don't cover anything beyond the original purchase by the original owner. This means that even if you bought a previously owned home with virtually brand new appliances, you will not be able to take advantage of the manufacturer's warranty yourself. If you are the original buyer of appliances, you may opt for extended warranties. Bear in mind that this a la carte pricing will add up quickly, as each appliance or system will have its own warranty term and cost.

You can avoid this item-by-item spending on appliance protection with a home warranty. Unlike the manufacturer's warranty, a home warranty can cover repair and replacement of multiple (sometimes all) appliances and systems in your home, as long as repair and replacement is limited to problems arising from regular use. It doesn't matter who bought the appliance or what it's original date of purchase is; plus, home warranties are renewable. The age of covered appliances or how many owners they've had don't limit your ability to purchase a home warranty. This can be a real benefit for those purchasing an older home with built-in appliances.

One thing to remember with a home warranty is that there's a trade call fee, which is a small fee the homeowner must pay for the service provider to come to the home and diagnose the problem. The fee covers the visit and the amount is clearly stated on every contract. The benefits of a home warranty are numerous, however, such as the ability to file a claim with most home warranty providers 24 hours a day, 7 days a week, 365 days a year. For more information on home warranties, visit our home warranty information page.

Which Warranty Should I Choose?

When it comes to warranties, it's your responsibility to understand the fine details and read between the lines, choosing a solution that suits your specific needs best. Here are a couple of questions to help guide you toward a warranty solution that's best for you.

• Which appliances and systems are covered, and which ones are not?
• Which repairs specific to your appliances and systems are covered, and which ones are not?
• How much does the home warranty cost, how long is the term of service, and what does the renewal process entail?
• How quickly will the OEM respond to service calls vs. the home warranty company?
• Are you purchasing an old home with built-in appliances?
• If your appliances are relatively new, are you the original purchaser with the ability to utilize the manufacturer's warranty?
• Have you read the fine print and understood the ins and outs of your warranty?

Hopefully, this guide has helped you understand the difference between a home warranty and a manufacturer's warranty. Remember to do your due diligence and find the solution that works best for you.