Oct 2011

hsa home warranty plumbing coverage

About 85% of the home warranty amount is absolutely profit and commission to the people. It is unbelievable—the vast majority. About 12% of the extended warranty or the home warranty or the electronics warranty is actually the risk that you’re taking. In other words, the cost of the average item breaking down within the warranty period usually runs about 12%. The rest of what you’re paying is profit, commissions, overhead and marketing costs. I would rather just take the chance. Put $. 88 in my pocket of every dollar—$888 of every $1,000 that I would’ve spent on warranties and $12 in savings, and on average, I’m going to cover the breakdown that those warranties would’ve covered. The big items, you transfer the risk on. That’s why we buy life insurance. That’s why we buy homeowner’s insurance.

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Oct 2011

choice home warranty average cost

5. That being said, you need to really do your homework to know exactly what is covered by your warranty. You also need to keep up with regular maintenance for your appliances so that way they won't be considered "neglected" and that will not be covered by your warranty. ANSWER: Never buy them. Don’t buy home warranties. Don’t buy extended warranties.

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