For homeowners who feel anxious about the condition of their appliances and systems, the home warranty offers a measure of protection against expensive, unanticipated problems and repairs. While warranties provide peace of mind, are they worth the cost?

Home warranties typically cost buyers about $400 per year. Less expensive policies cover fewer appliances – for example, only those in the kitchen and the laundry room – while deluxe plans may cover everything including pools, spas, built-in refrigerators, and more. Owners pay a small service fee for the initial visit when the warranty-contracted repairman diagnoses the problem. Following this visit, the warranty company foots the bill for the full repair (or replacement, if necessary).

If you own a piece of real estate filled to the brim with older appliances nearing the end of their useful lives, purchasing a home warranty is probably wise. This is because the cost of purchasing and installing a new appliance probably costs more than a warranty, and the likelihood of expensive visits from the repairman increases with every passing year.

If you own a newer home, however, you may not need one – even if your appliance warranties expired years ago. Consider – on average – how often a repairman has visited your home to fix an appliance. Perhaps once a year, or maybe twice? Also, don’t forget that if you or your spouse has a talent for home repair, you may be able to fix many problems yourself.

If you call a repairman to your house more than twice per year, a home warranty is probably cost effective. If not, you can probably go without. Luckily, you have all the time in the world, because unlike many types of warranties, you can purchase a home warranty at your convenience.

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