Does a home warranty cover pre-existing conditions? This question is a tricky one for home warranty customers, and the answer can change depending on the situation and the home warranty company in question. Let’s look into what a pre-existing condition is, and why it may affect the coverage on a homeowner’s home warranty plan.
What is a pre-existing condition?
Within a home warranty context, a pre-existing condition is any system or appliance that is failing or has failed before the date that coverage begins. (The date that coverage begins is usually the day of closing for someone who is buying a home or the date that the home warranty is purchased for homeowners who are buying a warranty on a home they’ve already purchased.) This pre-existing condition may be lack of maintenance on a system or appliance or could be a part that is failing from old age.
Whether or not a home warranty company will cover these pre-existing conditions depends on the home warranty company’s contract. Landmark Home Warranty will cover pre-existing conditions that were present before the date of coverage begins if they meet the following standards:
- If a home inspection is completed 60 days before coverage begins and shows the failed system or appliance in good working condition and properly maintained.
- If a visual or mechanical test would not have shown any sign of a problem, and the system or appliance would have been in good working condition and properly maintained.
Systems or appliances may fail from a pre-existing condition that would have been completely undetectable during a visual or mechanical test. In these cases, Landmark Home Warranty will cover the failed system or appliance.
A Home Warranty Will Not Repair or Replace Problems with Systems and Appliances Shown on a Home Inspection
If you’re purchasing a home, you’ll most likely get your potential home inspected. This home inspection is a vital part of ensuring you get failed systems or appliances covered by your home warranty company. Once you have purchased your home, make sure to send your home inspection to your home warranty company so they have it on file, and include any receipts of repair work done to fix the problems noted on the home inspection.
However, it’s important to note that a home warranty will not cover repairs and replacements that are noted on a home inspection. Many of our customers become frustrated when they try to open a claim on something that was noted as having a problem in their home inspection, and then find out that the repair or replacement won’t be covered. Real estate agents should make sure to set proper expectations that a home warranty will only cover repairs and replacements of systems and appliances that fail after coverage begins. Home buyers should read their home warranty contract to ensure they know what will and will not be covered once they close on the home.
If a home inspection turns up a problem in a home, the home buyers and realtor should ask for the problems to be fixed before they close on the home. If not, they should ask for a discount on the home in order to pay for the systems and appliance repairs themselves. Then, make sure to gather the receipts for the repair work done on the home and send them to the home warranty company along with the home inspection so the record shows everything was in working condition at the start of home warranty coverage.
Think of it like car insurance – if you wreck your car and then try to purchase insurance and open a claim, your new insurance company won’t pay to replace your car. This is similar to a home warranty plan! If you have detailed inspection notes showing there is a problem with a system or appliance, the home warranty won’t cover the repairs.
A Home Warranty on an Older Home
For a home that isn’t involved in a real estate transaction, systems and appliances must show that they would have been working properly 60 days before the home warranty coverage begins. This is why it’s vitally important to do maintenance on your home’s systems and appliances so that they’re clean and working properly before warranty coverage begins. Home warranties purchased outside of a real estate transaction also are subject to a 30-day waiting period to ensure that the systems and appliances are in proper working condition before coverage begins.
A Home Warranty Will Cover Pre-Existing Conditions if They Are Undetectable
So, will a home warranty cover a pre-existing condition? In short – yes. If a home inspector couldn’t find a problem and there would have been no way to tell there was something wrong with the system or appliance 60 days before the home warranty coverage began, then the home warranty will cover the pre-existing condition. Pre-existing conditions can still cause failures without being noticed by a visual inspection or mechanical test. In that case, the system or appliance will be covered by the home warranty plan. If the system or appliance was noted as having a problem on a home inspection, or the problem would have been apparent 60 days before coverage began, then the home warranty will not cover the pre-existing condition.