Home Insurance vs Home Warranty: Key Differences Explained
July 03, 2025

Owning a home is a dream come true for many. It's where we build our lives, create memories, and find solace. But along with the joys of homeownership come responsibilities, including protecting our property from unforeseen circumstances. This is where home insurance and home warranty come into play.
In this article, we will explore the key differences between home insurance and warranty, helping you make an informed decision about which option best suits your needs. So, let's dive in!
Home Insurance: Coverage for Catastrophic Events
Home insurance is a type of property insurance that safeguards your home and personal belongings against losses caused by covered perils such as fire, theft, and natural disasters. It covers the structure of your home, personal belongings, liability protection, and additional living expenses if your house becomes uninhabitable due to a covered peril.
Coverage Types:
- Structure Coverage: Home insurance helps repair or rebuild your house if it's damaged or destroyed by a covered peril. This coverage may also extend to other structures on your property, such as garages or sheds.
- Personal Belongings Coverage: Your furniture, clothes, electronics, and other personal belongings are protected in case of theft or damage caused by covered perils.
- Liability Protection: Homeowners insurance provides financial protection against lawsuits for injuries or property damage caused by you, your family members, or pets.
- Additional Living Expenses Coverage: If your home becomes temporarily uninhabitable due to a covered peril, home insurance covers the cost of living in alternative accommodations.
Home Warranty: Protection for Appliances and Systems
A home warranty is a service contract that covers the repair, replacement, or servicing of major appliances and home systems due to normal wear and tear. It acts as an additional layer of protection for items not covered by homeowners’ insurance.
Coverage Types:
Home warranty plans typically cover a range of appliances and built-in systems commonly found in homes. These include:
- Appliances: Refrigerators, dishwashers, microwaves, ovens, washing machines, dryers, etc.
- Built-In Systems: Heating and cooling systems, ductwork, electrical systems, central vacuum systems, plumbing systems, etc.
Key Differences Between Home Insurance and Home Warranty
While both home insurance and home warranty protect your property, there are key differences between the two:
Criteria | Home Insurance | Home Warranty |
Coverage Types | Structure, personal belongings, liability, living expenses | Appliances, built-in systems |
Perils Covered | Fire, theft, natural disasters, liability | Normal wear and tear |
Claim Process | File a claim for specific perils | Request service for covered appliances/systems |
Monthly Payments | Premiums based on property value and risk factors | Monthly or annual fees |
Deductibles | Deductible per claim | Service fee per repair/replacement |
Insurance vs Warranty: Which Option is Right for You?
Consider the below parameters to make an informed decision:
- Age of Appliances/Systems: A home warranty could provide added peace of mind if you have older appliances or systems prone to breakdowns.
- Financial Situation: You may not require a home warranty if you have enough savings to cover unexpected repairs or replacements.
- Existing Coverage: Check your home insurance policy to see if it already covers appliances or built-in systems. If it does, you may not need a separate home warranty.
- New Homeowners: A home warranty can benefit first-time homeowners or those buying a pre-owned home, covering potential issues with older appliances or systems.
Final Thoughts
Understanding the differences between home insurance vs warranty is crucial for protecting your property and ensuring peace of mind. Home insurance safeguards you against catastrophic events such as fire or theft, while a home warranty covers everyday wear and tear issues with appliances and systems.
Buying a house has never been this easy! Avail Ujjivan SFB’s wide range of affordable home loan products and enjoy a hassle-free loan journey. From house purchase loan to plot loans and home improvement loans, we have it all! Alternatively, you can browse through Ujjivan SFB product suite - our wide range of financial products are designed to make your financial life better.
Disclaimer:
The contents herein are only for informational purposes and generic in nature. The content does not amount to an offer, invitation or solicitation of any kind to buy or sell, and are not intended to create any legal rights or obligations. This information is subject to updation, completion, amendment and verification without notice. The contents herein are also subject to other product-specific terms and conditions, as well as any applicable third-party terms and conditions, for which Ujjivan Small Finance Bank assumes no responsibility or liability.
Nothing contained herein is intended to constitute financial, investment, legal, tax, or any other professional advice or opinion. Please obtain professional advice before making investment or any other decisions. Any investment decisions that may be made by the you shall be at your own sole discretion, independent analysis and evaluation of the risks involved. The use of any information set out in this document is entirely at the user’s own risk. Ujjivan Small Finance Bank Limited makes no representation or warranty, express or implied, as to the accuracy and completeness for any information herein. The Bank disclaims any and all liability for any loss or damage (direct, indirect, consequential, or otherwise) incurred by you due to use of or due to investment, product application decisions made by you on the basis of the contents herein. While the information is prepared in good faith from sources deemed reliable (including public sources), the Bank disclaims any liability with respect to accuracy of information or any error or omission or any loss or damage incurred by anyone in reliance on the contents herein, in any manner whatsoever.
To know more about Ujjivan Small Finance Bank Products Visit:"https://www.ujjivansfb.in"
All intellectual property rights, including copyrights, trademarks, and other proprietary rights, pertaining to the content and materials displayed herein, belong
to Ujjivan Small Finance Bank Limited or its licensors. Unauthorised use or misuse of any intellectual property, or other content displayed herein is strictly prohibited and the same is not intended for distribution to, or use by, any person in any jurisdiction where such distribution or use would (by reason of that person’s nationality, residence or otherwise) be contrary to law or registration or would subject Ujjivan Small Finance Bank Limited or its affiliates to any licensing or registration requirements.
FAQs
1. What is the difference between home insurance and a home warranty?
Home insurance covers catastrophic events such as fire, theft, and natural disasters, while a home warranty offers protection for everyday wear and tear problems with appliances and systems.
2. Can I have both home insurance and a home warranty?
Yes, it's possible to have both. Home insurance covers different aspects of your property, while a home warranty focuses specifically on appliance and system repairs or replacements.
3. Are home insurance premiums tax-deductible?
Home insurance premiums are not typically tax-deductible in India. However, it's advisable to consult with a tax professional for specific details related to your situation.
4. How long does a home warranty last?
A home warranty usually lasts one year but can be renewed annually.
5. Can I transfer my home warranty to a new owner if I sell my house?
Yes, many home warranty providers offer the option to transfer the warranty to the new homeowner as part of the sale process.
6. Can I cancel my home insurance or home warranty at any time?
Both home insurance and home warranties can usually be cancelled, but it's important to check the terms and conditions of your specific policy or contract for details.
7. Can I file multiple claims under my home insurance policy?
Yes, you can file multiple claims under your home insurance policy, but each claim may be subject to a deductible.
8. Can I customise my home warranty plan?
Some home warranty providers offer additional coverage options for items not included in their standard plans, allowing you to customise your coverage.
9. How do I choose the right home insurance or home warranty provider?
Research different providers, compare their coverage options and costs, read customer reviews, and consider their reputation and reliability before deciding.
10. Does law require a home warranty?
No, a home warranty is not legally required, but certain mortgage lenders may recommend or require it.
Latest Blogs

How Jewellers in India Calculate Gold Price
June 26, 2025
Gold jewellery holds a special place in Indian culture, often bought during festivals and family celebrations.

How to Link Your Mobile Number with Aadhaar Online & Offline Methods)
June 25, 2025
Linking your mobile number with Aadhaar is essential if you want to access Aadhaar-based services like e-KYC and Video KYC for bank accounts, OTP verification, filing taxes, e-Aadhaar downloads, and biometric authentication. Without a registered mobile number, you can't use any online Aadhaar services.

The Importance of Property Insurance When Taking a Home Loan
June 25, 2025
A home loan is a long-term financial commitment often spanning between 10 to 20 years, or even more.

Fixed Deposits vs Sovereign Gold Bonds (SGB): Which Is the Better Investment?
June 24, 2025
In today’s uncertain economic climate, conservative and low-risk investment options continue to dominate the choices of Indian savers.

FD vs SIP: Not a Race, But a Financial Match
June 24, 2025
We often treat money like a race — chasing returns, tracking trends, comparing who’s earning more from what.
Quick Links
Registered with DICGC

