Home warranties are already more affordable than many people expect. In fact, they easily fit into most budgets. However, that doesn’t mean you can’t save more money when shopping for a Pennsylvania home warranty. Check out some tips that will help you spend less on your policy. Then, you can pay less for comprehensive coverage.
- Pay a Higher Service Fee
There are two costs associated with home warranties: premiums and service fees. The premium refers to the annual or monthly payment you’ll make to keep your plan in good standing. As long as you keep up with your premiums, your plan will be in effect, so you can file claims and receive service.
The service fee refers to the amount of money you’ll pay each time a technician comes out to your home. This is similar to an auto insurance deductible. As with auto insurance, you’ll need to pay a fee to get the repair or replacement.
You can reduce your premium by increasing your service fee. For instance, assume that a company offers three service fee tiers for $50, $75, and $100. If you choose the plan with the $50 service fee, your premiums will be higher since the warranty company will receive less money when it provides service. Thus, you’ll pay more on the front end.
On the other hand, the $100 service fee plan will have the lowest premium. You’ll pay more when the technician comes out but less upfront. Finally, you can meet in the middle by choosing the policy with the $75 service fee.
When shopping around for a home warranty, find out how much the service fee impacts the premium. Then, adjust the fee accordingly so you can stick to your budget.
- Choose a Plan With Lower Coverage Caps
Home warranties often include coverage caps and limits that stipulate how much the company will spend on repairs and replacements. Some companies specify caps for each specific item listed in the warranty, while others have a general cap that’s used across the board. For instance, if your plan has a $5,000 per item limit, that’s the cap for all covered items.
Along with item caps, plans typically have annual limits. For example, a plan might set the limit of $20,000 for the entire year. Thus, you can make claims up to that limit, but once you reach $20,000, you’ll have to pay out of pocket.
Your plan’s caps and limits will directly impact the cost of your premium. If you have extremely high limits, you’ll pay more each month or year. However, if you go with lower limits, you can save money on your yearly or annual costs.
Compare plans with various caps and limits to see how you can save. Then, you can select a plan with moderate limits and reasonable pricing.
- Don’t Choose Your Own Contractors
When shopping for a warranty, you’ll notice that some companies let you choose your own contractors, while others don’t. At first, you might think it’s a good idea to choose your own contractors. However, this comes with two major drawbacks.
First, of course, you’ll have to contact the contractor yourself and schedule the appointment. This can be time-consuming and frustrating, especially if you have trouble finding a company that works on your particular system or appliance. You won’t have to do that if the company assigns a contractor to your claim. It’ll schedule the service for you, so you won’t have to be involved.
Second, and more importantly, you’ll likely pay a higher premium if you choose your own contractor. Warranty companies generally have to pay full price for services when customers select the contractors. On the other hand, they typically get discounts from contractors in their network. Basically, the technicians complete jobs for lower prices in exchange for getting lots of work. The companies often pass the savings down to the customers, meaning you can expect a lower premium if you go this route.
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Keep these tips in mind when shopping for a home warranty. By paying a higher service fee, lowering the cap and limits, and letting the company choose contractors for you, you can save a considerable amount of money while still getting the protection you need.