When you are financially prepared to buy a house and want to begin searching for the right one to buy, you might come across some terms that you do not fully understand. During the home buying process, you are likely to hear things about home warranties and home insurance, and you might want to know if these are the same things. A home warranty and home insurance are two very different things, and you should understand the main differences as you prepare to buy a home.

One is required; one is optional

The first difference between a home inspection and home insurance is that home insurance is a requirement when you buy and own a house, while a home warranty is optional. You cannot choose whether or not you insure your home, unless you own it outright, then you can choose not to insure it; however, this is not recommended. A home warranty, though, is something you can opt to buy if you want extra coverage for parts of your home that are not covered by your home insurance policy.

One covers perils to your home and things; one covers certain items only

The second key difference is what home insurance and home warranties cover. Home insurance is basically the protection you have against major perils that can leave your home damaged, and this includes fires, storms, and wind. If any of these perils causes damages to your home, you can file a claim with your insurance, and they will pay for the costs of the repairs if you have the right types of insurance.

A home warranty, on the other hand, is something that protects certain parts of your home. In most cases, a home warranty will cover things like your HVAC system, plumbing system, and appliances. If you experience problems with these things, you can contact your home warranty company and they will send a technician to make the necessary repairs. If this happens, you will pay only a small fee for the services instead of paying for the full cost of the repairs.

Both are important to have

While there are several key differences between home warranties and home insurance, both are important to have, and you can typically purchase both types of coverages through an insurance company.

If you are interested in learning more about home insurance coverage and home warranties, talk to your realtor or contact a home insurance company of your choice.