How Much Does a Home Warranty Cost?
Home warranty plans provide useful insurance ‘coverage’ against a breakdown of systems or appliances in your home. The quality of these plans is a factor of price, coverage, and credibility. Home warranty companies are a dime a dozen. There are several established companies, and many up-and-coming enterprises offering home warranty coverage to clientele. The average costs of home warranties depends on a myriad of factors, including the number of companies that have been included in the analysis, the types of plans that are covered, and the variations included in the sample. Based on extensive analysis by home warranty expert, Review Home Warranties the following data has been compiled across 14,053 plans and plan variations from 34 companies and some 274 plans.
- The grand average cost of a home warranty per year is $616
Of course, there are many other statistics that contribute towards home warranty prices, including the house type, the house age, the deductible that must be paid, the term of the homewarranty, the plan type, and the state where it is offered. By state, the average price ranges from $500 through $706. By plan type, you can expect average prices to range from $456 for appliance plans to $733 for combo platinum plans. In terms of the duration of the plan, you can expect the costs of home warranties to start at $205 for a long-term plan all the way through to $642 for a 1 year plan.
If your deductible is greater than $100, the cost of the plan is typically $607. However, if there is no deductible, the costs of a home warranty plan average out at $754. New constructions are also associated with lower home warranty costs at $376, compared to existing homes at $679. Your house type also affects the price of home warranty coverage from $406 for a small condominium to $1,592 for a large fourplex.
Why Is there so Much Variation in Home Warranty Costs?
The costs of home warranty plans are determined by multiple factors (as listed above). There are many elements that come into play, including climate, the term of the home warranty, the type of residence you live in, the coverage offered by your plan, and the deductible. Home warranty costs are high in New York, New Hampshire, and Connecticut at over $650 per year, and are also high in states like New Mexico, Texas, Oklahoma, Kansas, Missouri, Arkansas, Louisiana, Mississippi, Alabama, Georgia, Tennessee, Kentucky, Ohio, West Virginia, Pennsylvania, and Maryland. Those states typically have home warranty costs in the region of $600 – $650 per year. In Florida, California and Washington, home warranty prices are typically less than $550.
It’s interesting to point out that the states with the highest annual costs for home warranties are Connecticut, Rhode Island, and Alaska with top end figures of $1,424, $1,424, and $1,259 respectively. The states with the lowest annual home warranty costs include Washington, California, and Florida with figures of $264, $249, and $320 respectively. Another important point to bear in mind is that Florida has the most reliable power grid in the country. Additionally, temperatures in Florida are hardly ever in the negatives, and except for bad storms (tropical storms and hurricanes), there is little that affects the power grid in the state. It makes sense that states like Alaska have high home warranty costs given that you’re dealing with subzero temperatures and very little coverage.
This is interesting because a lot of companies offer home warranty with different costs and different coverage. The costs are usually high so I don’t think its advisable for small families. And do home warranties price also depend on the geographical location of the property?