Many new construction buyers confuse home warranties with homeowners’ insurance, but they’re not the same thing. While they may overlap slightly, they serve very different purposes. Check out our guide below!
Questions? Reach out to one of our knowledgeable insurance agents. We’re eager to set you up with the right coverage and rate!
Here’s a breakdown of how they compare:
| Coverage Type | Home Warranty | Homeowners Insurance |
| Purpose | Covers breakdowns of systems/appliances due to normal wear | Covers unexpected damage to your home or belongings |
| Cost | Usually paid upfront or included by builder | Paid annually or monthly as an insurance premium |
| Examples | Broken A/C unit, water heater, dishwasher motor | Fire damage, pipe burst, theft, storm damage |
| Duration | Typically, 1–10 years depending on the item | Continuous until cancelled |
| Payouts | You pay a service fee per repair call | Insurance pays minus your deductible |
| Who provides it | Warranty company (often through builder) | Licensed insurance carrier |
Do you need both?
Yes. While your warranty can help avoid out-of-pocket costs for maintenance-type breakdowns, it won’t cover:
- Weather damage
- Structural fires
- Stolen property
- Personal liability
- Living expenses after a disaster
Homeowners insurance picks up where your warranty ends.
Bonus Tip: Save Money with Smart Coverage
If your builder’s warranty covers major systems (like HVAC and plumbing) for the first 1–2 years, you might be able to adjust your insurance policy accordingly—just make sure you’re not leaving gaps.
Need help tailoring your coverage to fit your warranty? Cornerstone Insurance Agency LLC agents can walk you through it.