Home Warranty vs. Home Insurance

Home Warranty vs. Home Insurance

Home warranties and homeowners’ insurance are both designed to protect the buyer, but the policies cover different parts of the home and are paid for at different times. Learn how each is handled and how they can benefit you when you move into your new home.

Key Takeaways

• Homeowners’ insurance is required by the lender to close on the home. It generally covers property damage as well as liability for injuries to people on your property.
• A home warranty covers the basic mechanicals of the home for the first year of ownership. This protects the buyers from unexpected costs in the months after the closing
• If major appliances or mechanicals of the home break down, the warranty provides for repair or replacement after a small deductible

Videos are for informational purposes only and represent the opinions of the speakers. Chase does not warrant the completeness, timeliness or accuracy of the content.




Eric: So then, immediately when you buy your house, you have to have proof of insurance. That is something that you pay for as part of the closing cost.

Greg: Home owner’s insurance is something you’re gonna have from now, forever when you own your home, and that’s gonna basically give you insurance if someone comes onto your property and gets hurt, or if your water line breaks.

Amy: There’s a storm that comes through and there’s a tree on a roof, then the home owner’s insurance policy would kick in. And then there is the home warranty, and most of them are very similar in the things that they cover, its basic mechanicals of the home, some minor plumbing issues, some electrical issues.

Eric: The warranty is nice as a new home owner and you put all your money down on your house, you don’t have a lot of expenditures left in case your air conditioner blows up, or your furnace breaks so during that first year, any major appliances you can have repaired through the home warranty.

Greg :If there’s anything that maybe the home inspection didn’t pick up on, you don’t wanna buy a lemon so you wanna make sure you’re protected in that first year.

Eric: We had moved into the house, the garage door just stopped working one day, and we called the warranty personnel, we paid a fifty dollar deposit and they came out and fixed.

Greg: Buying a house, big expense and there could be big expensive things that you didn’t see up front that could go wrong. Anything that goes wrong with that property, that warranty is there as a protection for it.

Amy: Recently, we were doing a final walk through, myself and my clients. I opened the refrigerator to make sure everything was good there, and it wasn’t working, it was warm, and didn’t smell that great. In that instance, the contractor came out and found that the refrigerator just wasn’t worth repairing and so they got a new refrigerator and that was no additional charge to them because they had the home warranty in place.

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