What Can Home Appliance Insurance Do for Me?
Having a home appliance protection plan provides a number of benefits.
Coverage Beyond Homeowner’s Insurance
When you purchase a home or a new appliance, you will likely receive or be required to purchase some sort of insurance to cover equipment malfunctions or unexpected damages. With all of the options out there — from home appliance insurance to manufacturer’s warranties to homeowner’s insurance — it’s important to understand the different levels of coverage and what exactly is included in each protection plan. Here’s a description of each option.
Home Appliance Insurance / Home Appliance Warranty Plans
Similar to how an auto extended warranty would work for car parts and systems, these are optional service contracts that cover the repair or replacement of major systems and appliances.* They are typically 12-month agreements that include an annual contract fee and a service fee. Home appliance insurance can be offered an as add-on to your homeowners insurance, while a warranty is offered through a separate provider, such as Choice Home Warranty.
This is a warranty that usually comes with the purchase of a system or appliance and covers the repair or replacement of that specific item. Coverage typically lasts for one year and only applies to the original owner.
This is a mandatory policy that protects against accidental disasters, theft or vandalism. You pay an annual premium and deductible and the insurance policy will cover the additional costs.
Home appliance warranty plans can be an important financial safeguard for the appliances that are not covered by your homeowner’s policy or manufacturer’s warranty. These can include:
- Large home systems—HVAC, electrical systems and garage door openers
- Plumbing—Toilet tank, water heater and circulating pumps
- Appliances—Washer and dryer, dishwasher, refrigerator and garbage disposal
- Amenities—Additional refrigeration, pool and spa equipment and well pump
Peace of Mind
Forbes Magazine reports that the average American household owns approximately 24 electronic products, ranging from microwaves to computers to coffee makers to refrigerators. An estimated 96% of families own a microwave, 82% and 79% have a washer and dryer, respectively, and 59% have a dishwasher, according to the U.S. Energy Information Association.
Without the protection of a home warranty plan, you are responsible for paying for the repair or replacement of all of these household items, which can quickly add up. Manufacturer’s warranties can help reduce these costs, but you will likely be on the hook for the price of labor, parts, materials and potential replacement when the terms expire.
A home appliance protection plan brings peace of mind knowing that if your appliance or home system breaks, you don’t need to pay out hundreds of dollars at once or call around to find the right service provider. You can simply report the issue and pay the service fee, and we’ll have a licensed service technician to repair or replace your equipment within 48 hours.**
Home appliance insurance or another protection plan can save you money on the repair or replacement of dozens of covered items. Consider the life expectancy for common household appliances, as estimated by the International Association of Certified Home Inspectors and Sears Home Services.
||Life Expectancy (Years)
|Central Air Conditioner Unit
Say your refrigerator is seven years through its estimated maximum 13-year lifespan. It is safe to assume that as your fridge depreciates, you will need to spend $200–$400 in repair costs at least once over the next six years. When the time comes to purchase a new appliance, you might be looking at an additional $1,079 and $1,709 for energy efficient fridges, as estimated by Consumer Reports.
Assuming the average purchase price of $1,244, plus $250 in repair costs, you could be ready to spend between $1,444–$1,544 over the next six years to repair your existing refrigerator and eventually purchase a new one.
- Lifespan: 13 years
- Repair Costs: $250 (average)
- Replacement Costs: $1,244 (average)
- Total repair and replacement cost: $1,244–$1,544
- Home appliance service contract from Choice Home Warranty: Less than $1 a day
Start adding $1,150 for a new clothes washer and $975 for a new dryer, and the cost of maintaining a home quickly exceeds the annual service contract fee.
A service contract will cover the cost of your refrigerator, washer, dryer and many other common household appliances, potentially saving you a considerable amount of money over the lifespan of your home’s equipment.
A home appliance insurance plan can also make your house more attractive to potential buyers by driving up the selling price or reducing the time your house sits on market. Since home warranty plans are paid in advance, a potential buyer can feel assured that they will not be unpleasantly surprised with an expensive appliance failure or repair bill upon purchasing the home.