Home Warranty
How Much Does a Home Warranty Cost?
Average Cost: $300 – $1,200
Compare the best home warranty options
The Modernize Mission
We help homeowners make confident decisions through our reliable, up-to-date, and unbiased information and average project costs. All of our content is thoroughly reviewed and fact-checked by our team of home improvement experts. Learn more about how we maintain these values.
Understanding the cost of a home warranty is essential for homeowners looking to protect their major systems and appliances from unexpected breakdowns. A home warranty can provide peace of mind and financial security, but it’s important to know what you’re getting into before making a purchase.
In this article, we’ll explore the average cost of a home warranty, break down the expenses involved, guide you on choosing the right price tier and company, and evaluate the return on investment (ROI). By the end, you’ll have a clear picture of what to expect in terms of home warranty costs and how to make the best decision for your home.
Average Cost of a Home Warranty
The average cost of a home warranty can vary based on several factors, including the level of coverage and the provider. Generally, homeowners can expect to pay between $300 and $600 annually for a basic plan. For fuller coverage, costs can range from $600 to $1,200 per year. Monthly payments typically fall between $25 and $50 for basic plans and $50 to $100 for more inclusive plans.
The cost of a home warranty is influenced by the type of plan chosen. Basic plans usually cover essential systems like heating, plumbing, and electrical, as well as key appliances like refrigerators and ovens. Comprehensive plans, on the other hand, might include additional coverage for items like pools, spas, and well pumps.
Home Warranty Cost Breakdown
To better understand what you are paying for, let’s break down the typical components of a home warranty plan’s cost.
Premiums
In addition to premiums, homeowners are responsible for service fees or deductibles when a claim is made. These fees range from $50 to $125 per service visit and are paid to the technician who comes to your home to assess and fix the issue.
Optional Add-Ons
Many home warranty providers offer optional coverage add-ons for an additional cost. These can include coverage for items not typically included in standard plans, such as septic systems, second refrigerators, or HVAC units. Typical add-on costs can range from $50 to $200 per year for each additional item. For example, adding coverage for a pool or spa might cost an extra $100 to $300 annually, while coverage for a second refrigerator or an additional HVAC unit can add approximately $50 to $150 per year.
Factors That Impact Home Warranty Costs
Several factors can influence the cost of a home warranty:
- Coverage Level: The more extensive the coverage, the higher the cost. Basic plans are less expensive than comprehensive plans that cover a broader range of systems and appliances.
- Home Size: Larger homes may cost more to cover due to the increased number of systems and appliances.
- Home Age: Older homes might have higher premiums as they are more likely to require repairs.
- Location: Costs can vary by region due to differences in service provider availability and local labor rates.
- Company Pricing Policies: Different home warranty companies have varying pricing structures and promotions, affecting overall costs.
Home Warranty Costs by Company
The cost of a home warranty can vary widely between companies. Here are a few examples of popular home warranty providers and their pricing:
- American Home Shield: Offers plans ranging from $500 to $1,200 annually, with service fees between $75 and $125.
- Choice Home Warranty: Their plans typically range from $400 to $600 annually, with a standard service fee of $85.
- OneGuard: Offers plans costing between $400 and $700 per year, with service fees around $75.
These companies provide different levels of coverage and optional add-ons, so it’s essential to compare their offerings to find the best fit for your needs. To make your research easier, Modernize created this list of the 10 Best Home Warranty Companies. We recommend looking into each company’s costs, coverage inclusions and exclusions, response times, and service areas to ensure the company is right for you.
Next steps
Understanding home warranty costs and finding the best plan for your home and needs requires some research. Modernize recommends multi-sourcing by looking at online reviews for the companies that offer home warranties, speaking to neighbors, friends and family about their own experiences and looking to contractors who might be able to vouch for good (and bad) experiences with companies.
When comparing home warranties, make sure to ask the right questions to decide whether a package is right for you. From there, Modernize can help connect you to a trusted warranty provider in your area based on your specific needs and expectations.
Related Guides
Modernize Customer Portal Select your product below to sign in.
Modernize Bathroom Remodel Rating Methodology
How We Rate Bathroom Remodel Products and Companies We use two different sets of criteria depending on what we’re rating. For products and brands (like bathtubs, showerheads, and steam shower systems), we focus on how well they perform their core function, how durably they’re built, how much they cost relative to what you get, and how easy they are…
