How to Choose a Texas Home Warranty

A Texas Home Warranty can make appliance repair costs much cheaper, but your claims may be denied due to what's written in the fine print.
Written by Abbey Orzech
Reviewed by Melanie Reiff
Before committing to a home warranty in
Texas
, be sure to read the fine print and get clarification about anything you’re unsure about. Small details could make the difference between a plan that's worth your money and one that’s a ripoff. 
Being a homeowner comes with a ton of responsibilities. You are fully in charge of your home’s upkeep and maintenance—and those things can get pretty expensive. 
What's more, Texas homeowners may have even more to worry about than the rest of the nation. From earthquakes to
hurricanes
, Texans face a sizable share of natural disasters. 
While
homeowners insurance
helps cover your costs in the event of a break-in or natural disaster, you may need a separate home warranty plan to cover repair expenses for aging and failed appliances.
To help you choose the best home warranty in Texas, the
super app
for home and
auto insurance
,
Jerry
, has put together this guide on what's included in a warranty package—and when it's not worth the money to buy one.
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What is a home warranty?

A home warranty is a service contract to cover repairs and replacements for home appliances and systems. You pay a monthly fee to remain in the agreement, and when an appliance like your refrigerator or a system like your air conditioning breaks, you shell out a small service fee to have it repaired or replaced through your home warranty company. 
The perk of a home warranty is that you'll pay a much lower repair or replacement bill. The warranty covers the cost of repairs (but not completely) much like an insurance policy when you file a claim. 

Home warranty vs. home insurance

So, what’s the difference between a home warranty and home insurance? The biggest difference between these two policies is the breadth of their coverage.  
A home insurance policy covers the entire structure and the contents of your home—but it only provides coverage when an unexpected event happens, like a fire or break-in. The list of circumstances covered by your home insurance is often called a list of
named perils
Wear and tear is never included in home insurance. So if your AC unit breaks down (an immense pain in that Texas heat) because of a faulty or worn-out part, your insurance will not pay for your new one. 
A home warranty plan only covers home appliances and systems and is designed to cover repairs from aged and worn-out parts. You may think it's easy to file a home warranty claim every time you have an appliance issue, but there's a notable ambiguity to home warranties—it can be difficult to know whether they'll approve or deny your claims.
If something breaks due to “owner negligence" (either actual or perceived), for instance, the home warranty won’t cover the cost of repairs. 

Do you need a home warranty in Texas?

Homeowners in Texas aren't required to purchase a home warranty. However, a warranty may be desirable, particularly for new homeowners or those who feel that they don’t have the financial cushion to handle a major unexpected repair bill. 
Some home warranty agreements come with a lot of fine print that can severely limit your coverage options. If you’re looking into getting a home warranty, be sure to research diligently to make sure you’ll get the services you’re paying for. 
If you find a home warranty isn't worth the hassle, you could set aside the money that would go toward your home warranty each month and start building up your emergency fund

How to choose a Texas home warranty

When you’re deciding on a home warranty company, you should request estimates based on your home’s details from at least two to three companies. You’ll nearly always save money or get better coverage by comparing plans. Ask around for recommendations from friends, family, or even your real estate agent! 
Check out the table below for an in-depth comparison of five of the best home warranty companies in Texas. And before you sign any contracts, make sure you understand everything in the agreement so you’re not being tricked.
Company
Monthly payment
Annual premium
Service fee
States not covered
BBB rating
Limits
What it’s best for
Choice Home Warranty
$36-$44
$517-$660
$60-$85
Washington
B
$500-$3,000
Fast response times, basic plan covers both systems and appliances
American Home Shield
$40-$58
$300-891
$75-$125
Alaska
B
$1,000-$6,000
Longest reputation, highest coverage limits, lower chance of service denial
Select Home Warranty
$36-38
$630-$765
$60-$75
Nevada, New Mexico, Washington, Wyoming
B
$500-$2,000
Discounts and response times
Liberty Home Guard
$40-$60
$700-$960
$65-$125
Washington, Wyoming
A
$500-$2,000
Best customer service, tons of coverage add-ons
America’s First Choice (AFC) Home Club
$43-$60
$465-$544
$75-$125
California, Hawaii
B
$1,000-$2,000
Flexible and customizable plans

The pros and cons of home warranties

A home warranty may sound like a great deal, and many homeowners in Texas enjoy substantial financial relief through their home warranty plan. On the other hand, some homeowners share what can sound like nightmares in which they've been ripped off or denied coverage. 
To aid you in your exploration of home warranties, consider these pros and cons of agreeing to a home warranty. 

Pro: Takes the guesswork out of hiring contractors

When one of your most important appliances (think: A/C in the Texas heat) breaks, you’ll likely want to get the repair or replacement taken care of right away. If you don’t have a home warranty, you could be searching around for a while to identify the right contractor. With a home warranty, however, you will already have a person to call. 

Pro: Lessens the need for an emergency fund

Appliance and home system repairs are some of the more significant expenses homeowners have to face. Without a home warranty, a replacement of your HVAC system can run you thousands of dollars, but with a home warranty, you’ll catch a major discount
The $40-$150 service fee will be much easier to handle than the $5,000-$10,000 replacement fee you'd pay without warranty coverage. This means that you don't have to worry about building as large of a rainy day fund (even though it's always recommended that you have one!). 
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Con: You won’t deal directly with contractors

While not having to hunt around for a repair person is a nice convenience, the lack of direct communication with your contractor can cause a lot of frustration. The process may be slow, and you won’t have the final say in what repairs or replacements are made. 
If you’re someone who prefers to oversee all elements of the repair process, you may not be satisfied with a home warranty. 

Con: Low coverage limits and high service fees

If you’re faced with a major (and expensive) repair, your home warranty coverage may not be enough. Home warranty companies have coverage caps that can range between $500 and $5,000, so if the service you need is outside of their limit window, you’ll have to pay the rest.
Additionally, you'll be subject to a service fee for every repair that is made through the policy.

Con: Your coverage may be denied

This hitch is perhaps the most important—and the reason that home warranties are widely considered controversial. 
Your claim may be denied due to suspicion of “owner negligence”, meaning there is a lot of room for warranty companies to interpret damage as the owner’s fault rather than legitimate wear and tear. 

How to find affordable homeowners insurance in Texas

You may want to find a good home warranty plan, but the terms can be confusing, the process of deciding on one can be difficult, and even if you sign a decent contract, your claim may still be denied. 
Finding an affordable homeowners insurance policy, on the other hand, doesn't even require you to lift a finger.
Jerry
does all the hard work of finding quotes and signing onto a policy for you.
Jerry is an
insurance comparison app
that shops for low prices with dozens of different insurance companies for free. You will get quotes in seconds, can make changes at any time, and if you ever have any questions, agents are just a text away!
Jerry
had a super simple app that was easy to navigate. And their terrific customer service made everything even easier. Plus I saved $700 in a single year.” —Lucia M.
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FAQs

The exact amount of a home warranty in Texas will depend on the size and location of your home and the plan you choose, but on average, Texas homeowners pay between $300 and $960 a year on their home warranty plan.
Most home warranties in Texas have a one-year term but it’s possible to find longer terms.
The best home warranty company will vary from person to person based on their needs and personal situations, however, American Home Shield is a very popular home warranty company for its high coverage caps.
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