Best Cost-Effective Home Warranty Companies

By Amanda Lutz

Aug 10, 2023
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Our survey of 1,000 homeowners revealed that more than 75% had previously hired a contractor to repair a home system or appliance. Nearly 50% of those homeowners spent time locating a contractor through online research. If you’re looking to reduce the inconvenience of a system or appliance breakdown, a home warranty can help by connecting you directly with a contractor. 

In addition to sourcing knowledgeable contractors, enrolling in a home warranty helps you account for unexpected expenses. This guide will walk you through choosing a cost-effective home warranty plan that fits your needs.

We based all pricing information used in this article on quotes for a single-family home smaller than 5,000 square feet in Genoa, Nevada, near Lake Tahoe.

Best for Extensive Coverage
Monthly Cost $65–$76
Service Fee $100–$125
Plans Offered 3
VISIT SITE Limited Time Offer: Get $150 Off All Plans!
Best Add-On Variety
Monthly Cost $49-$60
Service Fee $65–$125
Plans Offered 3
VISIT SITE $200 Off + 2 Months Free + Roof Leak Protection
Best Budget Coverage
Monthly Cost $44–$48
Service Fee $65–$75
Plans Offered 3
VISIT SITE Use code HOUSE25 for $150 off & 2 months free
Best for Systems Coverage
Monthly Cost $59–$77
Service Fee $75–$125
Plans Offered 3
VISIT SITE Special Offer: $100 Off with Code “PROTECT”

The Most Cost-Effective Home Warranty Companies

Here are the most cost-effective home warranty companies:


 

American Home Shield

Best for Extensive Coverage

American Home Shield

Best for Extensive Coverage
4.1
At a Glance
BBB Rating: B
Monthly Cost: $65–$76
Service Fee: $100–$125
Phone: (844) 804-5378

Liberty Home Guard

Best Add-On Variety

Liberty Home Guard

Best Add-On Variety
4.2
At a Glance
BBB Rating: A+
Monthly Cost: $49-$60
Service Fee: $65–$125
Phone: 866-452-9107

Select Home Warranty

Best Budget Coverage

Select Home Warranty

Best Budget Coverage
3.9
At a Glance
BBB Rating: B-
Monthly Cost: $44–$48
Service Fee: $65–$75
Phone: 888-370-3956

AFC Home Club

Best Membership Perks

AFC Home Club

Best Membership Perks
4.5
At a Glance
BBB Rating: B
Monthly Cost: $47–$56
Service Fee: $75–$125
Phone: 877-755-1115

First American Home Warranty

Best for Systems Coverage

First American Home Warranty

Best for Systems Coverage
4.3
At a Glance
BBB Rating: B
Monthly Cost: $59–$77
Service Fee: $75–$125
Phone: 800-891-9778

HomeServe

Best for Specific Needs

HomeServe

Best for Specific Needs
3.7
At a Glance
BBB Rating: A+
Monthly Cost: $29–58
Service Fee: $100
Phone: 877-348-4427

Our Recommendation

If you’re willing to pay a bit more for your monthly fees, American Home Shield offers some of the most comprehensive coverage options in the industry. Additionally, its generous coverage caps on built-in systems can help homeowners avoid many of the urgent and unexpected costs of homeownership. 

If monthly premium flexibility is your priority, First American Home Warranty offers three service call fee options that change your monthly cost. You may be interested in HomeServe plan options if you’re looking for specialized coverage for items outside the typical scope of a home warranty plan, such as exterior utility lines.

Best for Extensive Coverage
Monthly Cost $65–$76
Service Fee $100–$125
Plans Offered 3
VISIT SITE Limited Time Offer: Get $150 Off All Plans!
Best Add-On Variety
Monthly Cost $49-$60
Service Fee $65–$125
Plans Offered 3
VISIT SITE $200 Off + 2 Months Free + Roof Leak Protection
Best Budget Coverage
Monthly Cost $44–$48
Service Fee $65–$75
Plans Offered 3
VISIT SITE Use code HOUSE25 for $150 off & 2 months free
Best for Systems Coverage
Monthly Cost $59–$77
Service Fee $75–$125
Plans Offered 3
VISIT SITE Special Offer: $100 Off with Code “PROTECT”

 

How to Choose a Home Warranty

A cost-effective plan that provides the best value to a homeowner is not necessarily synonymous with the cheapest home warranty companies. With these services, the best way to get top value from your home warranty is to carefully review the terms and conditions and the covered items to confirm they align with your priorities. Follow these simple steps to choose a home warranty that meets your needs: 


 

Is a Home Warranty Worth It?

A home warranty could be worth it for the peace of mind it provides. For example, imagine you’re taking a shower after a long day. Suddenly, there’s no hot water. You discover that the water heater has broken. Though an unplanned cold shower is unpleasant, a home warranty can help you resolve the breakdown with minimal hassle. You simply file a claim and pay a minimal service call fee to start the home repair process. 

After you file your claim, your home warranty provider will initiate a service request on your behalf, including matching you with a local, licensed contractor specializing in your repair need. Across the industry, providers typically initiate a service request within 24 to 48 hours of receiving a claim.


 

Which Home Warranty Has the Lowest Service Fee?

Our research of more than three dozen home warranty companies indicated that the industry’s average service call fee is roughly $77.

The service call fee is your responsibility each time you file a claim, so it’s important to weigh the amount you’ll be paying for a technician to diagnose the cause of the breakdown relative to the value of the covered item. If you’re expecting to cover primarily big-ticket items, a higher service call fee can allow you to lower your monthly premiums to a minimal expense.


 

Do Home Warranties Have Coverage Caps?

Any reputable home warranty company will provide homeowners with a copy of its service contract before they enroll in a plan. The fine print of home warranty policies will typically stipulate a coverage cap or limit. These coverage limits will outline the maximum dollar amount a provider will pay for a covered item. It does not mean you’ll always receive that coverage when you file a claim, but it does indicate the maximum potential coverage.


 

Do Home Warranties Cover Old Appliances?

It’s rare for a home warranty to exclude appliances based solely on their age; however, an older appliance may not be eligible for the same replacement value as a brand-new appliance. Therefore, the total coverage for an older appliance will be based on the pro-rated, depreciated value.


 

Frequently Asked Questions About Home Warranties

What is a service call fee?

A service call fee is similar to a deductible charged by an insurance company. Providers charge a service call fee each time you file a new claim. Service call fees range from $65 to $125, depending on your provider and plan selection.

What should I look for when buying a home warranty?

When buying a home warranty, you should look for three main factors: cost, coverage options, and exclusions. Every homeowner’s situation is different. Consider your budget, coverage needs, and any notable coverage exclusions before selecting a home warranty provider.

Who regulates home warranties?

State government bodies and industry associations regulate home warranties. Both entities work together to create laws that regulate companies. These regulatory bodies also offer consumer resources to improve home warranty experiences.

What does a home warranty not cover?

Home warranties typically don’t cover routine maintenance, appliance removal and disposal fees, or commercial property. We recommend reading your provider’s sample contract to determine what it covers or doesn’t cover in your policy.


 

How We Chose the Top Home Warranty Providers

Our team reviewed and researched dozens of home warranty providers, thoroughly analyzed sample agreements, and identified customer pain points based on our analysis of customer reviews and interviews with industry experts. Our in-depth methodology outlines our review process to provide transparent information about the companies we review.

We determined that the following factors are the most important when comparing home warranty companies: available plans, plan coverage, price range, industry reputation, customer support, and additional features. Our research supported that plan coverage, customer service, and industry reputation should carry the most weight. While important, the other factors should not have as much influence when choosing a home warranty provider.