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Top 5 Best Home Warranty Companies (2021 Comparison)
We’ve reviewed the top 5 home warranty companies and listed them side by side so you can compare the plans, costs, deductibles, exclusions, and coverages to find the best company for your budget.
Below you’ll find our custom built interactive home warranty finder tool designed to help you locate the best home warranty that fits your specific financial situation in your local area and State.
The ReviewHomeWarranties.com team updates this tool with fresh data and rankings every day so you can be sure you’re getting the latest information!
Simply click the drop downs and select your preferred plan type (appliance, systems or both), desired premium, deductible, how high you want your limits to be, coverage, and the State you live in. The tool will automatically populate with the home warranties that best match your needs.
Out of all the home warranty companies we reviewed, Choice Home Warranty has the most comprehensive plans, good payout limits, minimal number exclusions, quality customer service, and affordable cost.
Choice has two main home warranty plans. The “Basic Plan” and the more comprehensive “Total Plan” covering 15 home appliances (dishwasher, etc) and systems (duct work, water heater, etc). They also have “Optional Coverage” for add on items most homeowners don’t usually have, which include pools and spas, well pump, sump pump, roof leaks, other extraneous items.
Based on our review, Choice’s “Total” plan covers these items at a more affordable price point than its competitors although has a few more exclusions, which is how they can justify charging a lower monthly payment.
The thing about home warranties is that they are a bit complicated with a lot of moving parts that may confuse most homeowners on what’s covered versus what’s not covered.
A key deciding factor in our review looking for the best home warranty company is finding one with top quality customer service to help customers like you walk through the claims process so you don’t have to worry about nasty surprises when you need service.
That said, Choice has 24 hours a day 7 days a week 365 days a year availability and a 48 hour response time to get a contractor out to your home. Other providers tend to have slower response times and are less communicative about when technicians are assigned to your claim.
Policy On Pre-Existing Issues or Older Units?
Choice covers appliances regardless of age or existing wear and tear, so you don’t need to worry about signing up and not getting covered due to age assuming you’ve properly maintained the item over it’s life.
What’s not covered is if you or someone else breaks the unit regardless of when it happens. All home warranties, regardless of company, won’t cover a unit you break through negligence or misuse (i.e., baby sticks chocolate bar into VCR).
Far and away the most thorough and transparent home warranty company we reviewed is American Home Shield. They are the gold standard. If you spend any amount of time on their website, it’s clear that they are very upfront about what they do cover and don’t cover when compared to their competitors.
In fact, they go out of their way to tell you they cover things their competitors don’t like rust or plumbing stoppages.
They also have the best home warranty coverage with an astounding 21 systems and major appliances including trash compactor, smoke detectors, and clothes washer. They also have the fewest number of exclusions with the highest dollar limit payout amounts ranging from $1,000 – $3,000 per claim.
Think of American Home Shield as the “BMW” or “Mercedes” of home warranty companies. More expensive than Choice, but with better coverage and limits.
Policy On Pre-Existing Issues or Older Units?
Very similar to Choice, American Home Shield covers old systems and appliances that break down due to wear and tear, but they do not cover pre-existing issues or negligence related to the misuse of your appliance or system!
Select Home Warranty made our list as a best budget friendly home warranty option. They have lower limits ranging from $500 – $2,000 per claim but also lower service fee costs and potentially reduced annual premiums as low $325 per year if you opt into multiple year contracts, far below other competitors.
If you opt for their “Platinum Care” they are on-par with other providers in terms of what they actually cover.
Overall, a great budget option for people who want a home warranty but can’t afford Choice or American Home Shield.
Policy On Pre-Existing Issues or Older Units?
Very similar to Choice and American Home Shield, Select covers old systems and appliances that break down due to wear and tear, but they do not cover pre-existing issues or negligence related to the misuse of your appliance or system!
Pros
Most Affordable Service Contracts
Roof leaks Are Covered In Their Platinum Plan
Cons
Ultra Pushy Sales
3 Days To Submit Claim
Weaker Network Of Contractors
Total Home Protect Review (Best For Larger Systems)
Total Home Warranty made our list as a home warranty with above average protection on more robust systems like septic systems and roof coverage.
Their monthly cost comes out to around ~$45 per month for their basic “Gold” plan, which puts them on the more expensive side of the scale when compared to other top home warranties on our list with better coverage.
Most home warranties do not cover anything related to your roof but Total Home Protect does, which we found to be unique to their offering helping them crack our top list.
Policy On Pre-Existing Issues or Older Units?
Very similar to Choice and AHS, Total Home Protect covers old systems and appliances that break down due to wear and tear, but they do not cover pre-existing issues or negligence related to the misuse of your appliance or system!
Pros
You Can Choose Your Own Technicians
Roof Coverage
Cons
More Exclusions Than Most Competitors
The Worst BBB score
Low Payout Limits ($500)
First American Home Warranty Review (Best Customer Service)
First American Home Warranty made our list as a home warranty with above average customer service mixed with in with a decent price point.
The only drawback was that they aren’t nationwide lacking coverage in the following states: ND, MN, WI, IL, NY, VT, NH, ME, MA, CT , RI , DE, AL, HI, LA,
Their plan options include a “Basic“ plan, which only covers appliances and will run you about $28 per month. Their combo plan, which covers major systems and appliances branded the “Premier” plan costs around to ~$43 per month.
Overall a good home warranty provider, but just lacking the coverage, which would have helped make a better case for “best overall home warranty company”.
Policy On Pre-Existing Issues or Older Units?
Again, all of the home warranty providers seem to have adopted a similar policy in that they cover “old” appliances and systems that break down due to wear and tear, but they do not cover pre-existing issues or negligence related to the misuse of your appliance or system!
Now that we’ve gone through the top companies on our list, we wanted to put together our write up to help you understand how we’ve rated each of these companies.
Your trust is means a lot to us so it’s important that you know how our selection of top home warranty companies was made.
Our ratings are based on an analysis of 68 home warranty issuers as well as customer feedback.
This data helped drive which areas of home warranties we wanted to review and include in our write-ups. Specifically, we rated home warranty companies on the following areas:
Service Fee
Coverage
Exclusions
Limits
Affordability
Customer Service
BBB Rating & Profile
We graded each company based on these areas. See below for a description of each and how we considered them in our review!
The “Service Fee” And Our Rating
If you’re unfamiliar with how home warranties work, you sign up for service, pay the yearly fee (or “premium”) and then if you ever need service you have to pay the “service fee” when a contractor comes out to inspect your broken appliance or system.
This fee is also called a “trade service call fee”, and it’s kind of like a deductible, but you pay it every time regardless if the home warranty company fixes your unit or not.
You can think of service fees like “co-payments” when you go to the doctor. They prevent homeowners from constantly calling the home warranty company by charging a fee so when there is actually a problem you’re willing to spend a bit of money for someone to come out and look at it.
Some home warranty companies have a set fee like Choice Home Warranty, which charges a flat $85 per service call. Other companies like American Home Shield, let you pick from a range ($75 – $125). If you pick $75 then your yearly premium for coverage goes up, if you pick $125 it goes down.
This is actually a good thing to have, because if you think you’ll use your plan a lot, picking the lower fee will save you money. Either way, all home warranty companies will charge you this fee, so it’s important for us to call it out in our review.
Considering The Coverage In Our Rating
When picking your home warranty, you need to pay special attention to the coverages because this refers to what is actually covered in your plan. Some plans have systems and appliances bundled together, others do not.
To make it even more confusing, some plans cover as many as 21 systems and appliances, others cover only 15 leaving out key systems you might use.
In our review we dig into the nitty gritty details of the service contracts to vet out what’s covered and what’s not within each plan so you can make an informed decision.
How Exclusions Affect Our Rating
Exclusions are a critical facet in a home warranty service contract, because it protects the home warranty company from things that may cause your home appliances or systems to break, which are unrelated to normal wear and tear. In our data we found that heating and air conditioning were among the most common requests in home warranty claims. Below you can see our full breakdown!
If there are a lot of exclusions in your contract, it makes it easier for your home warranty company to try and disqualify your repair request.
For example, a common cause of disqualification often used by home warranty companies is “improper installation”. This means whoever installed the appliance or system didn’t do it correctly, therefore the unit was more likely to break down sooner than it would have through normal use, thus it is excluded from coverage.
Another example exclusion might be that all the parts of your clothes dryer are covered except for the knobs and dials on the actual machine! If you were to break off the knob on your clothes dryer, your home warranty service provider is not on the hook to help you fix it.
Perhaps there is rust buildup and corrosion in your plumbing system. Most home warranty companies explicitly exclude rust from coverage, but American Home Shield does cover rust related repairs, which is great for you. Had you gone with a different provider like Total Home Protection, it would have been excluded!
So each company handles exclusions a bit differently, which we have accounted for in our review.
Now on one hand exclusions stink, but on the other hand, they are in place to prevent bad actors from abusing the policy. If home warranty companies DIDN’T have exclusions, it’s unlikely there would be any in business.
At the end of the day, what you need to know is that if you think your refrigerator is nearing the end of its life, and the home warranty plan you’re considering has a long list of exclusions related to refrigerators, you should probably look elsewhere or consider upgrading your plan for more robust coverage.
Also, our recommendation is to get a home inspection to really understand the current state of your home. Then get that home inspector to walk you through their report with a sample contract from your home warranty company so you know exactly what’s excluded and what’s not excluded BEFORE you want to make a claim.
How Limits Affect Our Rating
Where the “limits” come into play are the caps on actual payouts you can receive for repairs on covered items. You want this number to be as high as possible so you can get higher payouts.
For example, Choice Home Warranty has a limit of $1,500 for heating systems, which means that it will payout up to $1,500 on covered claims to help repair the unit. If the actual cost is $3,000 to repair the unit quoted by the contractor, you would need to cover the difference between the coverage and the final bill.
Similar to exclusions, limits are meant to protect home warranty companies and your limit will usually depend on how much you’re willing to pay for your annual premium.
For example, American Home Shield has some of the highest limits availible (up to $3,000) but also charge close to the highest annual premium for coverage.
Part of our review was locating the best home warranty company with a good balance of monthly cost for their plans and dollar limit payout.
Affordability of The Plan Importance
When reviewing each company, we also looked at the general affordability of each plan. The costs of home warranties of annual premiums and deductibles can vary by state. Below, you can find data for all 50 states including Rhode Island, Texas, New York, California, Alaska, North Dakota, Montana and Hawaii.
Based on our data, we put together a graphic of what you can expect to be charged on average by state as well as the general availability of home warranty companies.
There needs to be a balance between coverage and the cost of coverage, which is your premium paid. More expensive providers like American Home Shield have higher limits but also cost substantially more than value based providers like Choice Home Warranty.
Companies like Total Home Protection have very similar fees related to Choice but substantially lower limits. For example, Choice has $1,500 limits where THP has $500 limits, but Choice is a bit cheaper. This means if your furnace breaks down over the winter, THP will give you a maximum of $500 for repairs while Choice $1,500.
Also, when negotiating a contractor with a home warranty provider, you’ll likely get offered multiple year deals in exchange for lower yearly premiums. So keep that in mind if you find a home warranty company you like.
In our review, we call this out so you can make the right decision that fits your budget.
Read Also: Can I Have Warranty Coverage For My Washington, D.C. Home?
Quality Customer Service Rated
The last area we looked at in-detail was customer service.
Out of our data, we found that about 7% of the customers complained about tricky or vague terms and conditions, and more than 33% experienced problems with coverage of their home systems or appliances. See below for a breakdown each the complaints by type from our data.
Home warranties are notoriously difficult to navigate so it’s important that the company has a good customer service center to field your questions and set up service calls if something breaks.
For example, are the answers you get from the company consistent between customer service representatives? Do they quickly and promptly schedule contractors to come out on service calls? Do they offer to refund service fees if something goes wrong during the claim as a gesture of goodwill?
These are all things we’re looking for when reviewing each home warranty company below.
Why We Potentially Ignore The Better Business Bureau Score?
When it comes to doing your own research on whether to do business with a company, you likely go to the Better Business Bureau website to check their score right? Anything under a solid “A Rating” would be a signal that the company isn’t trustworthy right?
Normally this is a great idea, but when vetting home warranty companies, things get a bit more complicated.
You have to understand that due to the very nature of home warranties (i.e., complicated contracts, exclusions, etc) there will be an increase of negative customer experiences due to the misunderstanding of contract terms.
It’s a fact that home warranties can be valuable and can save you a lot of money if you use them correctly, but problems arise when homeowners think their home warranty is some kind of blanket coverage for all the stuff in your house.
Many people who buy home warranties are misled by sales people or simply don’t read the contract they sign. The contracts by definition have to outline every exclusion a homeowner may come across.
For example, say a homeowner buys a “Basic” plan from Choice Home Warranty because their refrigerator is getting old. Months later their fridge stops working, so they go to make a claim for repairs, except when they talk to the representative, they are told they needed to buy the “Total Plan” not the basic plan, which has more comprehensive coverage. This is a common scenario of misunderstanding that may result in a BBB complaint.
When reviewing companies, we need to take their BBB score with a grain of salt because of the complicated nature of home warranties and the fact that people only tend to complain when they have a problem.
That said, we look at the BBB score of each company to get a sense of reputation and see how the company reacts to resolving each customer issue. It’s one thing to get a negative customer complaint and try to remediate the situation through proper conflict resolution, it’s another thing to just ignore the customer.
— Frequently Asked Questions —
How Does A Home Warranty Work?
A home warranty works by covering systems and appliances inside your home.
This is different from home insurance in that homeowners insurance covers your whole house in the event of a natural disaster where your house would burn down or flood it. Home warranties are more for major systems insider your home like your HVAC system, water heater, or air conditioner and appliances like your ceiling fan, ice maker, microwave oven, or dishwasher.
Banks also require homeowners insurance as apart of the agreement to issue you a mortgage because if your house burned down they would have no way of recouping the loss on the house. In contrast, banks do not require home warranties.
Generally, home warranties are better for older home systems and appliances where the manufacturer’s warranty has expired or is about to expire. Real estate agents tend to gift them to their clients as a gesture of goodwill after a real estate transaction. Also homebuyers can buy a home warranty themselves at any time and they become active 30 days after signing up.
The process for obtaining a home warranty goes something like this.
Step 1: Obtain A Free Quote
All home warranty companies will give you the option of obtaining a free quote before starting service.
As we frequently mention, we recommend having a home inspector walk through their inspection report with you to ensure so you know exactly which systems and appliance may malfunction in the near future. This gives you a punch list of units where it may make sense to buy a home warranty to cover.
Step 2: Decided On Coverage Options
Coverage varies depending on the plan you select. Home warranty companies like to brand their plans so they are more memorable like the “Platinum Plan” or “Total Plan” but really there are only 3 types you need to know about.
Those are:
An Appliances Plan (just appliances)
A Systems Plan (just systems)
A Combo Plan (both)
The combo plan is the most expensive as it has the most comprehensive coverage. Some home warranty companies also offer “a la carte” options where you can pick and choose what you want covered.
For example, American Home Shield offers a “build your own” plan option, so if you just want coverage on your garage door opener and your electrical system but nothing else, you can do that.
This can potentially save you money if you know which items in your house are nearing the end of their life. It’s also worth pointing out most plans will be 12 month commitments, with the option to do multiple year contracts for reduced cost.
Step 3: Make A Service Request
When you actually need to fix something that has broken, you’ll need to initiate a service request with your home warranty provider. Most will have an online portal or a direct phone number to call.
Our recommendation is to use the phone number to ensure your claim gets routed properly as the online self service portals can be a bit hard to navigate and confusing.
Step 4: Contractor Review
When the service call is placed, the home warranty company will contact a contractor in their network, who will then call you to schedule a time to come and inspect your unit.
What you need to know about the contractors is that they use home warranty companies as a way for them to grow their own business without marketing. So if an electrician needs more customers, they might join a home warranty network to start receiving more business.
This means home warranty companies need to always be recruiting contractors to be in their network and respond to calls from customers around the country. This creates a massive logistical headache when there is a surge of calls during the peak of the season and not enough contractors in the home warranty companies network.
Sometimes home warranty plans allow you the option of picking your own contractor, which might be your preference if you have a trusted technician you always go to.
Step 5: Service Call & Repair Approval
When a contractor comes to your home they’ll collect the service fee and then inspect your unit based on the details of your claim. They then relay those details to the home warranty company for approval prior to repairing it.
This step is critical for you to understand because the communication between the contractor and the home warranty company will determine if you get paid out or not on your claim.
That said, you need to be absolutely careful of what you say to the contractor because you could accidentally say something that may lead them to believe you caused the damage through negligence (not covered) instead of wear and tear (covered).
Step 6: Repair Or Replacement
The last step is that the contractor gets approval for the repair and fixes your broken unit. If they can’t fix it or the cost to fix are prohibitively high, they’ll just replace the unit.
If the unit cost is higher than the payout limit in your plan, then your home warranty company will issue you a check for the maximum amount and the remaining balance will have to come out of pocket.
What Are Home Warranty Costs?
Now that you know how home warranties work let’s talk about the costs you’ll likely incur.
Thankfully, there is only 2 major costs you’ll likely incur when signing up for a home warranty plan. Those are annual premiums and service fees.
Annual Premium
These are costs for just having the plan and range from $25 – $50/month. Your premium will go up or down based on how much coverage you select during the sign up process.
Service Fees
Think of these like “co-payments”. These are the costs for contractors to respond to each individual claim. These range from $60 to $125 per request.
Final Thoughts On Our Top Pick For Best Home Warranty Company
The main gripe most homeowners have with home warranty companies is about understanding what is, and what is not covered in their policy.
You have to understand that home warranty companies can’t outline every scenario an appliance or home system may go through in their different plans. You need to also consider the fact there are homeowners who don’t take care of their house and break things through their own negligence expecting their home warranty to foot the bill.
Home warranty companies would go out of business if they attempted to cover such scenarios, which is why “exclusions” exist in the first place. For example, rust buildup on A/C coils is a common exclusion that could be easily prevented through routine maintenance.
Home warranty companies have terms, which try to outline everything excluded in their plans, but these documents are often hard to read and interpret by most homeowners. Our suggestion would be to get a home inspector to walk through the terms document of your home warranty provider insider your home so you know exactly what is and isn’t covered before something breaks.
All that to say, our top pick for best home warranty is Choice Home Warranty. After our review, they have the best balance of coverage, mid-tier payout limits, minimal exclusions, and quality customer service all at a reasonable cost.
Through our review, Choice genuinely tries to help protect it’s customers get the most benefit from their plans. If problems arise due to issues with the contractors assigned to claims, they try to resolve the issues through refunds, credits, and proper communication.
A close second is the name brand American Home Shield, as they have some of the best coverage with highest payouts, but cost more than Choice.
