What Does a Standard Home Warranty Cover?
A standard home warranty typically does not cover foundation repair. Most warranties cover essential systems like plumbing, electrical, HVAC, and appliances, with foundation damage often left as a separate concern requiring either specialized foundation warranties or a specific insurance policy. This can be frustrating if you face unexpected issues; however, understanding what’s typically covered and what’s not can save you from unwelcome surprises.
Limited Coverage for Foundation Repairs
While basic home warranties generally exclude foundation repair, some companies offer limited coverage options for foundation-related issues as an add-on to your warranty package. Here’s what to keep in mind:
- Basic Plans: Basic home warranty plans generally don’t cover structural repairs or foundation issues.
- Add-On Options: Some home warranty providers offer foundation repair coverage as an add-on, but this is uncommon.
- Check for Builder’s Warranties: If you recently purchased a newly constructed home, your foundation might be covered under a builder’s warranty for the first few years. This warranty can cover significant structural defects, including foundation issues that arise shortly after construction.
Key Considerations for Home Warranty Policies
Understanding the scope of your policy is crucial. Here’s a breakdown of what to keep in mind:
- Review Your Policy Thoroughly: It’s important to carefully review your home warranty policy to know exactly what is covered and where the limitations lie.
- Look for Exclusions: Home warranty exclusions often include foundation repair, especially if the damage results from soil movement, natural settling, or other wear and tear deemed “normal” by warranty providers.
- Separate Foundation Warranty: If you live in a region prone to foundation issues, consider investing in a separate foundation warranty for added protection. This can provide coverage specifically tailored to the unique risks your home may face.
Filing a Claim for Foundation Repair Under a Home Warranty
If your home warranty does cover foundation repairs, knowing the claim process can save you time and frustration. Here’s a step-by-step guide to filing a claim effectively:
- Contact Your Provider: The first step is to reach out to your home warranty company and report the damage.
- Provide Detailed Information: Explain the issue, including any visible signs like cracks or uneven floors, and ensure the company has access to your property for an inspection. Typically, they will send a contractor to assess the damage.
- Service Fees May Apply: Depending on your warranty plan, you may need to pay a service fee even if the claim is approved. This fee varies by company but is generally minimal compared to the potential cost of foundation repairs.
Foundation Repair and Insurance: Understanding the Differences
While a home warranty and homeowners insurance both offer protection, they cover different types of incidents:
- Homeowners Insurance: Insurance policies cover sudden and accidental damage, such as that caused by storms, flooding, or other natural disasters.
- Home Warranties: These are more geared toward gradual issues or failures in household systems and appliances. They rarely cover foundation repairs, though certain policies may offer add-ons or exceptions.
In cases where neither a home warranty nor homeowners insurance applies, a separate foundation warranty might be the best choice, especially if you live in an area susceptible to foundation issues.
Conclusion
Given that most home warranties do not include foundation repairs, it’s worth considering alternative options for peace of mind. A builder’s warranty can offer limited protection if your home is newly constructed, and a separate foundation warranty provides additional coverage if you’re in an area with a high risk of foundation issues.
