When you buy a home warranty, you’ll notice that most providers say they will repair OR replace a covered item in the event of a breakdown. But when will your home warranty company actually replace something instead of just repairing it? It depends on the company, and there are several things to keep in mind.
Some home warranty companies only cover repairs – not complete replacements. Be sure you read your contract and understand the terms and conditions. If your company doesn’t say that they will replace broken items, they won’t under any circumstances. If your company says they will repair OR replace, keep in mind that they will always try to repair before offering to replace anything.
In fact, don’t be surprised if your provider tries to repair a broken appliance or system multiple times before finally offering to replace the unit. I’ve heard stories of leaky pipes being patched up several times before the warranty provider finally just replaces the pipe. I have personally had my air conditioner serviced twice before the compressor was finally replaced when I had to call a technician back for a 3rd visit.
But don’t let this scare you away. You bought a home warranty because you want to save money. A warranty is a value service, not a premium service. You cannot buy a home warranty and expect to get fast service and brand new appliances anytime there is a small issue.
One more thing to keep in mind: most companies place limits on how much they will spend on repairs and replacements. If you have a $5,000 oven, your provider will probably not replace it with the same oven. They may pay out a smaller amount toward a replacement. Read your contract! These limits will be spelled out in plain terms.