Home Warranty vs Home Insurance — Direct Comparison
| Factor | Home Warranty | Home Insurance |
|---|---|---|
| What it covers | System/appliance breakdown from wear and tear | Damage from fire, storm, theft, liability |
| What it doesn't cover | Structural damage, weather events | Normal wear and tear, mechanical breakdown |
| Required by mortgage? | No | Yes |
| Monthly cost | $30–$90/month | $100–$200/month (varies) |
| Service/deductible | $60–$125 per claim | $500–$2,500 deductible |
| Best for | Aging appliances/systems | Property damage protection |
| Pays | Repair/replacement contractor | Property repair/rebuild + liability |
Damage from fire, wind, hail, lightning, smoke, vandalism, theft, and water damage from burst pipes. Liability if someone is injured on your property. Additional living expenses if your home is uninhabitable. The structure of your home including roof, walls, and foundation.
HVAC system breakdown, water heater failure, plumbing stoppages, electrical system issues, refrigerator, dishwasher, washer/dryer, oven/range breakdown from normal use. Any mechanical breakdown from wear and tear is the home warranty's domain — insurance won't touch it.
Frequently Asked Questions
Most homeowners benefit from both. Home insurance is legally required if you have a mortgage. Home warranty is optional but covers the gaps insurance doesn't — your HVAC failing on a hot summer day, your water heater breaking, your refrigerator dying. Together they provide comprehensive protection. Combined monthly cost: $150–$300 for both.
Home insurance covers roof damage from storms, hail, and other sudden events. Home warranty may cover roof leaks from normal wear and tear — but this varies significantly by company and plan. American Home Shield's ShieldPlatinum plan includes roof leak coverage. Most basic home warranty plans do not cover roof work. Check the specific plan terms before assuming roof protection is included.