Home Warranty vs. Home Insurance: A Clear Breakdown for 2025
For homeowners, the terms “home warranty” and “home insurance” can be confusing. Both offer financial protection related to your home, but they cover completely different types of problems. Mistaking one for the other can lead to denied claims and unexpected out-of-pocket expenses.
Here’s a clear and simple breakdown of the difference.
What is Home Insurance?
Home insurance (also called hazard insurance) is a type of property insurance that protects you from financial loss due to unexpected disasters, perils, and accidents. It covers things that might happen.
Home insurance typically covers:
- Damage to the structure: From events like fire, windstorms, hail, or lightning.
- Damage to personal belongings: From theft or a covered disaster.
- Liability protection: If someone is injured on your property.
Your mortgage lender requires you to have a home insurance policy.
What is a Home Warranty?
A home warranty is an optional service contract that covers the cost of repairing or replacing major home systems and appliances that fail due to normal wear and tear. It covers things that will likely break down eventually.
A home warranty typically covers:
- Major Systems: HVAC (heating and cooling), plumbing, electrical.
- Major Appliances: Refrigerator, oven, dishwasher, water heater, washer, and dryer.
When a covered item breaks, you file a claim, pay a small service fee (deductible), and the warranty company sends a contractor to diagnose and fix the problem.
At a Glance: Key Differences
| Aspect | Home Insurance | Home Warranty |
|---|---|---|
| Purpose | Protects against unexpected disasters | Covers repairs from normal wear and tear |
| Is it Required? | Yes, by mortgage lenders | No, it is optional |
Why DomiDocs is the Best Choice for Managing Both
DomiDocs does not sell insurance or warranties, but it is the essential platform where you manage them. True peace of mind comes from not only having these policies but also being able to find them when you need them most.
1. A Central Hub for All Policies
With DomiDocs, you can store your home insurance policy, your home warranty contract, and your insurance agent’s contact information in one secure, easy-to-access digital vault. In a moment of crisis—whether it’s a storm or a broken furnace—you’ll know exactly where to find your documents.
2. Link Policies to Your Home Inventory
When you file a home insurance claim for damaged belongings, you need an inventory. The DomiDocs home inventory tool allows you to create a detailed list of your possessions, which you can store right alongside your insurance policy, streamlining the claims process.
3. Track Service History
When a technician comes to fix an appliance under your home warranty, you can log the service call and upload the receipt in DomiDocs. This creates a complete maintenance history for your home’s major systems, which is invaluable for future reference and for proving the home has been well-maintained when you decide to sell.
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