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Home Warranty Plan vs. Homeowner’s Insurance Policy – What’s the Difference?

Homeowners often confuse the functions of a Home Warranty Plan and an insurance policy, and there is a distinct difference. Home Warranties are service contracts, as opposed to homeowners insurance, which is true insurance.  That is, an insurance policy undertakes to indemnify the homeowner against damage or liability which might arise from some unknown or contingent event.  In an insurance context, the agreement to indemnify means that the insurance company will compensate or reimburse the homeowner for the damages or losses that he or she may have incurred.  Home Warranty Plans do not indemnify losses; they repair or replace specific covered items in the home that fail during the term of the Plan.

This example helps clarify the way a home warranty and homeowners insurance can work in conjunction with one another: if a water pipe breaks and the house is flooded, the home warranty company will cover the repair of the pipe. The homeowners insurance company may cover the secondary water damage to the structure and/or contents of the home, which was caused by the pipe break.

To find out more about Old Republic Home Protection’s products and services, please call us at 800-445-6999 or visit our web site: Check out our Quick Tips section for simple home repairs – they can help save homeowners both time and money!

~This article is provided courtesy of Old Republic Home Protection, a leader in the home warranty industry, providing superior service, comprehensive coverage and competitive pricing.

For more information on the value and benefits of home warranty coverage or to order a home warranty, please contact local area representative Amanda Wood, serving Santa Barbara, San Luis Obispo and Kern Counties:

Amanda Wood
Account Executive
Old Republic Home Protection
(800) 282-7131 ext. 1210



Written by Amanda Wood - Go to Amanda's Website/Profile