Angie's List: Home warranties

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First-time home buyers may wonder if it's necessary to purchase a home warranty.

Speedway homeowner Ernest Goss was lucky. His home warranty worked out for him.

"I had to use my home warranty, because it was almost July when it was 100 degrees outside and my air conditioner just completely shut down and stopped working," Goss said.

Because of the warranty, Goss picked the more expensive route and went ahead and fixed all future problems.

"I think $800 for a whole brand new air conditioner install, with all the fees covered," he said.

"It all comes down to the contract, so read the fine print so you know exactly what is covered, what appliances, what types of service calls will be covered and then also understand the how the payment works. Is there a deductible and also, who makes the decisions about repair or replacing," said Angie Hicks, Angie's List.

Warranties are not designed to act as insurance to protect homeowners from loss. Think of them like an extra umbrella of protection. Home warranties may be a good option for home buyers purchasing a previously lived-in home.

"It comes down to, 'Will they include an inspection before the warranty, so you know exactly the condition of everything in your home?' Also, do they have a low deductible and 24-hour customer service, because you never know when that water heater will break," Hicks said.

Most home warranty plans cost between $350-500 for a one-year contract. Adding enhanced coverages, if they're available, could increase that cost. Don't forget, you'll also need to pay a small service fee for the repair.

A good home warranty company will have a 24-hour service line in case you need that emergency repair. Goss didn't renew his home warranty after the first year because his house inspection showed everything else in tip-top shape. But he's glad he had it when he needed it.

"The air conditioner, when I bought the house, it was too late for them to inspect and I had worries about that when I bought the house and grateful that I had a home warranty in order to cover it," Goss said.

If your warranty is purchased through your real estate agent, tell your agent about any denied claims. Oftentimes, he or she will have a relationship with the home warranty company and can make a call on your behalf.