As soon as we become homeowners, we want to protect our house from unexpected malfunctions of home systems and appliances, and our wallets from high repair costs. However, we don’t want to pay too much for a home warranty either. So, we start looking for the cheapest home warranty plan.
As we start selecting the best home warranty plan, many questions arise. If we just look at the price and buy the plan that costs less, will it give us the best value for our money? If plans in two different companies cost the same, will they provide the same coverage? Let’s take a look at the cheapest plans available on the home warranty insurance market and try to find the answers to these questions.
Prices for the Cheapest Home Warranty Companies
ReviewHomeWarranties.com has analyzed the prices for the cheapest plans in 24 home warranty companies. In three companies, the prices of the cheapest home warranty insurances were less than $200 per year. Five companies priced their cheapest warranty plans from $200 to $250, another fifteen companies had a price range between $250 and $500, and in one company, ABC Home Services, the cheapest plan was $625.
PER ANNUM PRICES
Such huge differences in costs of the cheapest home warranty insurance is explained by the coverage offered by each plan. For example, the $48 plan in HomeServe USA is called the Electrical Surge Coverage Plan. The electrical system is the only thing that is covered by this plan. Alternatively, the Home-SAFE Warranty/ABC Home Services plan that is available for $625 provides coverage for a wide range of home systems and appliances.
How much money can you save if you choose the cheapest warranty cover? To answer this question, we compared the prices for the cheapest and the most expensive plan within one company. The difference ranged from 18.3% to 82.6%. In the graph below, we show how much you can save if you buy the cheapest warranty plan in the company instead of the most expensive plan.
The data was collected from 24 home warranty companies. In four companies, there was no difference, all plans cost the same. In five companies you could save between 18.3% and 25.3% if you purchased a cheaper plan. In the other ten companies, the difference was between 34% and 47%. In the last group, the cheapest plan cost ranged from 52% to 82% percent less than the most expensive one. In Select Home Warranty, for example, you would pay 33.8% less for the cheapest plan, while in HelloSuper the difference would be 77.8%.
Coverage of the Cheapest Home Warranty Plans
What about similar-priced home warranty plans in different companies? How different is their coverage? To answer these questions, we selected three well-known home warranty companies: American Home Shield, Total Home Protection, and Choice Home Warranty, and compared their cheapest plans. In all three companies, the cheapest plan costs around $35 per month. Now let’s see what every plan covers.
In American Home Shield, there are two cheaper plans: The Systems Plan and the Appliance Plan. As we can infer from the name, the Systems Plan covers home systems: air conditioning, electrical, heating and plumbing, ceiling fans, alarm, doorbell, central vacuum, and water heater. The Appliance Plan, on the contrary, covers home appliances only. These include dishwasher, food center, microwave, oven, refrigerator, trash compactor, washer and dryer, and garage door. The service call fee for both plans is $125.
In Total Home Protection, the cheapest plan is the Silver Combo Plan. It includes the plumbing and electrical system and the following appliances: dishwasher, garbage disposal, microwave, oven, trash compactor, and water heater. Additionally, this plan includes coverage for a swimming pool and a whirlpool bathtub. The service call fee, or deductible, in Total Home Protection is $60.
The cheapest home warranty plan that Choice Home Warranty offers is the Silver Combo Plan for $34 a month. It includes coverage for heating and electrical systems, some kitchen appliances such as oven, built-in microwave, dishwasher, garbage disposal, and fan. Also, this plan covers ductwork, water heater, and garage door. The deductible, or service call fee, is $60.
As we can see, the cheapest plans in different companies may cost the same, but the coverage may vary significantly.
Final Words About the Cheapest Home Warranty Plans
To answer the question “Which home warranty plan is the cheapest?,” we analyzed data for 24 cheap home warranty companies and specifically compared the coverage of the cheapest plans in three well-known companies, American Home Shield, Total Home Protection, and Choice Home Warranty.
We found that there is a big difference in prices of the cheapest plans between companies. It can be attributed to the difference in coverage offered by each company. The best cheap home warranty plan that we had in our database covered only one home system, while the most expensive of the cheapest plans covered a wide range of home appliances and systems. While we compared the cheapest warranty plans in three companies that had similar price tags, we noticed that there was a significant difference between them. In American Home Shield, there were two equally priced plans, one for home systems, and the other for home appliances. Both Total Home Protection and Choice Home Warranty had the cheapest plans that combined coverage for home systems and home appliances, but the lists of items did not coincide.
The bottom line is that the cheapest home warranty plan does not mean the worst plan. As the cheapest plan coverage varies between companies, there is a chance to find the one that fits your house best without spending extra money on more expensive plans.