If you have recently purchased a new home, you have probably heard the terms home insurance and home warranty being thrown around often, and as a new homeowner, it is quite understandable if you feel lost. These two services are often confused with each other, but even though they do share a lot of similarities, the specific benefits of each are lost on most people.  Before purchasing either or both of them, you should fully understand each first. Below we discuss their main differences and lay out some pointers to aid your decision.

What is a Home Warranty?

It is a service provided to homeowners by home warranty companies to secure and take care of valuable items inside the house. Unlike home insurance, a home warranty will not provide compensation in case of any natural disaster-related damage. However, it usually offers a discounted rate to repair or replace some of your home’s major systems and appliances. Through this type of warranty, you will be able to protect your home from most danger by repairing, maintaining, or replacing your interior appliances and systems. Contacting your home warranty company is necessary when any covered items break down. They can then send one of their best contractors to assess the damage and fix it.

What is Home Insurance?

Your home is probably your most valuable asset. Not only does it contain all of your belongings, it will also hold many memories with you and be your safest space. It is therefore important to ensure its safety and take all the necessary protection measures into consideration.


A reliable homeowner’s insurance policy can cover natural disasters; the insurance company will handle the repair expenses of your house in case it’s damaged in a flood or an earthquake or any other environmental scenario. Some policies also provide coverage against theft, fire, and other man-made disasters. Compensation for your personal expenses, if the house is inhabitable, is also accounted for. Some homeowners’ insurance plans even include coverage for personal belongings such as furniture and clothes.

What Do You Need?

Home insurance covers the house’s structure from natural or man-made accidents. A home warranty on the other hand protects valuables or certain necessities inside the house. Each has its own benefits and it is hard to claim that either is better than the other. Many homeowners actually recommend getting both to ensure maximum security.

Deciding whether to get a home warranty or an insurance plan is entirely up to your context. Some people believe it is only necessary to get a warranty for the appliances and home systems as it eliminates the hassle of finding a reliable contractor and the space to avoid any unexpected expenses. On the other hand, others say that protecting the house against possible vandalism or unexpected natural disasters is more reliable in the larger scheme of things than protecting what’s inside the house. However, whether you decide to prioritize either or look into both, you have to have at least some sort of safety net for your house.

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