When purchasing a new home, there are many things buyers need to consider. Home insurance, home warranties, home inspections, closing costs, renovations—it’s easy to feel overwhelmed.
The process of protecting your home can be a bit of a headache, but it’s crucially important to consider all the available options in order to avoid unexpected costs down the line. That means purchasing a home insurance policy. It may also mean considering a home warranty policy.
If you’re confused about the difference between home insurance and home warranties, you’re not alone; it’s a commonly asked question.
As part of our commitment to providing clients with transparent and trustworthy service, we’ve created this guide to explain the differences between these two types of protection plans.
Wallace & Turner Insurance offers a range of affordable personal policy options for homeowners in Ohio. Contact our Springfield and Urbana insurance agents for more information, and keep reading to learn more about the difference between home insurance and home warranties.
What is Home Insurance?
Home insurance, or homeowners insurance, is a form of protection that can offer coverage for most losses or damage done to your home. This includes the structure of the home, the surrounding property and assets that are contained on the property. If you own a condominium instead of a house, condo insurance is the equivalent policy type.
Typically, home insurance plans can cover damage to the inside or outside of a house depending on the level of protection you purchase. Coverage can include damage done to the lawn, back yard, garage, shed, porch or any other structures on the property.
Homeowners insurance can also provide protection for assets located on the property, such as personal belongings, furniture and expensive electronics.
In addition to loss and damage protection, a home insurance policy can also protect you or your family members from liability if anyone is injured on your property. It can cover the cost of legal fees and other costs should there be a dispute of any kind.
Some of the other protection you may find in a home insurance policy are as follows:
Fire damage
Natural disasters and weather events (note: this does not cover floods or earthquakes)
Vandalism
Riots, aircraft and vehicles
Artificially generated electricity
Break and entering, theft and burglary
Accidents
Coverage for high-value items, such as jewelry and art
A home insurance policy can cover many different things that you deem to be important.
Speak to one of our agents to find out how we can customize a plan that protects what matters most to you.
Is Ohio Home Insurance Mandatory?
Home insurance is not required by law. However, most lenders will require home insurance. There’s a reason for this: home insurance is strongly encouraged so you don’t land in a financially precarious position due to accidents and damages.
What is Not Included in a Home Insurance Policy?
Each homeowners insurance policy is unique and can include a wide range of coverage options. In order to know what your home insurance covers, you’ll need to review your policy or speak to an agent.
In general, homeowners insurance does not cover repairs or replacements for appliances or other systems unless the damage was caused by a catastrophic event listed in your plan.
What is a Home Warranty?
Home warranties are policies that cover the potential repairs your new home might need once the sale is complete. These are plans that provide financial coverage for any unforeseen breakdowns of home appliances and systems.
Some of the systems that are included in a home warranty may be:
Washer and dryer systems
Kitchen appliances like stoves, refrigerators and microwaves
Water heaters
HVAC systems
Garage door systems
Plumbing and electrical systems
Ceiling fans
If you purchase a new home and any of these systems fail due to damage, regular usage or most other issues, a home warranty can provide you with coverage.
Is a Home Warranty Mandatory?
Home warranties are not mandatory for homeowners and offer a different kind of coverage. These plans can provide protection for items in your home that are no longer under manufacturer warranty.
Here’s an example: If your oven range catches on fire and damages your home, insurance should cover these costs. However, if your oven range simply stops working one day, that's where a home warranty comes in. Ideally, you could carry both; homeowners insurance probably being required for your home loan, whereas home warranties are not required, but are helpful to safeguard against major repair or replacement costs.
What is More Important, a Home Warranty or Home Insurance?
Without a doubt, home insurance is most important and, we would say, necessary for all homeowners. The primary reason being natural disasters, fires, and other major losses can have catastrophic outcomes. Homeowners insurance protects you against these huge events and ensures you can rebuild or get the financial assistance you need to recover.
Bottom line: home insurance can mitigate risk in a wide variety of circumstances and should be considered part of the cost of owning a home.
Find Urbana and Springfield Home Insurance You Can Trust
At Wallace & Turner Insurance, we protect what matters to you. As one of the most trusted and established independent insurance agencies in Ohio, we are dedicated to providing the best insurance coverage to our clients in Springfield and Urbana.
Contact us to learn more about how our home insurance coverage can provide you with the ultimate protection, so you can worry less about what may happen to your home, and just enjoy living in it.