Legal Definitions - home warranty

Home warranty is a contract that covers the cost of maintenance of a major housing system, such as plumbing or electrical wiring, for a set period of time from the date a house is sold. The warranty guarantees repairs to the covered system and is renewable.

For example, in Connecticut, a home warranty contract is defined as any agreement in which a person or company promises to repair or replace any structural component of a single or multiple-family dwelling of four or fewer units, necessitated by wear and tear, deterioration or inherent defect, failure of an inspection to detect the likelihood of wear and tear, deterioration or such defect, or substandard material or workmanship.

One example of a home warranty is a contract that covers the cost of repairing or replacing a home's heating and cooling system. Another example is a contract that covers the cost of repairing or replacing a home's plumbing system.

These examples illustrate how a home warranty can provide peace of mind to homeowners by covering the cost of unexpected repairs to major housing systems.