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First American Home Warranty Review 2022
By Joshua Rodriguez MONEY RESEARCH COLLECTIVE
- Upgrades cover several types of scenarios and equipment
- No present coverage caps on important systems
- Affordable monthly premiums and warranty plans
- BBB accredited since 2000
- Available in a limited number of states
- Central air conditioning systems are only covered as an upgrade
- Negative customer reviews concerning slow service and response times
Founded in 1984, First American Home Warranty has made a name for itself by providing competitive pricing and extensive home systems and appliance coverage. Ranking as one of the best home warranty companies in 2022, it stands out from the competition for its vast network of independent, prescreened contractors and qualified technicians.
If you’re in the market for a home warranty plan, consider First American. Read on to learn more about their home warranty coverage, monthly premiums, and the advantages and disadvantages that set them apart from other providers.
Pros explained
First American Home Warranty has grown to serve more than 625,000 customers and continues to outperform the competition. Companies don’t become that successful without providing significant advantages to their customers. There are several reasons to consider purchasing a home warranty from First American. Some of the most attractive advantages include:
Upgrades cover several scenarios and equipment
First American Home Warranty offers upgrades designed to make your life easier by providing a wide range of optional coverages. Just about anything that’s not included in its standard plans can be covered with upgrades at a low monthly cost. You can protect up to four refrigerators for just $6 per month. A $3,500 cap per unit gives you $14,000 in coverage.
Few home warranty companies are willing to provide coverage for structural construction of any kind. However, with the First Class Upgrade, First American will pay for the cost of permits and some construction projects if you’re required to make changes due to building code changes.
No preset coverage caps on important systems
Coverage caps are a pain, especially if your repair costs more than your warranty company is willing to pay. You won’t have much to worry about when it comes to the most costly systems if you purchase a plan with First American Home Warranty.
The company has a $3,500 coverage cap on individual kitchen appliances, but it doesn’t pay for damage that predates coverage.
The good news is that there are no preset coverage limits when it comes to the most expensive repairs, including expensive HVAC and ductwork fixes.
If your HVAC system fails and you have to replace it completely, you won’t have to worry about the several-thousand-dollar bill that will likely come down the line. That’s a huge saving considering the average cost to replace an HVAC system ranges from $5,000 to $10,000.
Affordable monthly premiums and warranty plans
Home warranty plans are designed to save you money, so they’re not going to do much good if their premiums break the bank. First American Home Warranty plans are inexpensive and competitively priced, making them widely accessible.
When you consider that your home is likely the largest investment you’ll ever make, these premiums aren’t a huge expense to protect it and the systems and appliances that keep it running.
Vast network of prescreened contractors
First American Home Warranty doesn’t require you to find your own contractors. Instead, the company has an expansive network of prescreened contractors in the states it serves.
If for any reason First American cannot locate a service provider to service your claim, they will ask you to contact an out-of-network provider. As long as this service provider is licensed and insured and seeks approval before performing their work, you’ll be reimbursed.
Cons explained
Working with First American Home Warranty has several clear advantages. You can’t argue with the agreeable cost, coverage and ability to customize your plan to fit your needs. On the other hand, no company is perfect.
You should consider a few disadvantages before signing up for a plan with First American Home Warranty.
Anti-consumer terms
Like many other home warranty companies, First American Home Warranty has anti-consumer terms in its contract that require you to waive your right to a jury trial if the company breaches its contract or is negligent with regard to its selection of contractors. You also must waive your right to participate in a class action lawsuit or private attorney general action suit. It’s a bit disquieting for a company to require its customers to give up their right to enforce the agreements that are the very essence of the service the company provides.
Available in a limited number of states
First American Home Warranty’s services are available in a limited number of states. The company doesn’t provides services in:
- Alaska
- Connecticut
- Delaware
- Hawaii
- Illinois
- Louisiana
- Maine
- Massachusetts
- Minnesota
- New Hampshire
- New York
- North Dakota
- Rhode Island
- Vermont
- Wisconsin
Other popular home warranty providers offer coverage for nearly every state, but as of 2022, First American hasn’t extended its services to these remaining 15 states.
Central air conditioning systems only covered as an upgrade
Central air conditioning systems are crucial to your ability to maintain a comfortable temperature in your home. Unfortunately, neither the Basic plan nor the Premier plan cover central air conditioning repairs or replacements, though the Premier plan does cover your heating system. If you want your central air conditioning unit and system covered, you’ll have to pay an extra $14 per month, which works out to just under 50 cents per day.
First American Home Warranty plans and add-ons
First American Home Warranty pricing is competitive, but you won’t have to give up quality coverage to take advantage of low prices. Although, the more you pay monthly, the more coverage you get.
First American offers Basic and Premier plans and policyholders can purchase additional coverage as needed. Here’s a breakdown of First American home warranty plans and pricing.
Basic plan
The company’s Basic plan is First American’s least expensive home warranty. The plan includes coverage for essential appliances, such as
- Ranges, ovens or cooktops
- Dishwashers
- Garbage disposals
- Built-in microwaves
- Freestanding or built-in refrigerators
- Trash compactors
- Washing machines and dryers
- Ceiling and attic exhaust fans
- Instant hot water dispensers
Prices for the basic plan start at around $30 per month, but they may be higher depending on your location and the coverage options you select.
Premier plan
The Premier plan includes everything found in the Basic plan, plus:
- Electrical systems
- Central vacuum systems
- Garage door openers
- Ductwork
- Heating systems
- Plumbing stoppages
- Water heaters
- Groundwater sump pumps
- Leaks and breaks of water, gas, sewer and drainage lines
- Toilet tanks and bowls
- Whirlpool bath pump and air switch assemblies
The Premier plan is designed to cover more extensive repairs that can potentially cost thousands of dollars.
Upgrades and add-ons
First American Home Warranty also offers a wide range of upgrades and add-ons for those who want to supplement the company’s default services. Of course, these come with an additional cost, but they may be worth adding to your plan. They include
- HVAC tune-up. $3/month
- Additional refrigeration (up to four units). $6/month
- Well pump. $11/month
- Septic tank system and pumping. $11/month
- Central air conditioning (electric). $14/month
- First Class Upgrade. $14/month
- Pool and spa equipment. $26/month
The First Class Upgrade covers the cost of permits and limited upgrades you may have to make if building codes in your area change. It also protects systems that have been improperly installed, the capture and removal of refrigerant, and the disposal of systems and appliances. Suppose your county passes new building codes that require you to install upgraded hurricane ties to connect your roof to your walls. First American Home Warranty will pay for the permits and the installation of the new ties.
Coverage limits and monthly costs of each plan
For the Basic and Premier plans, monthly costs vary depending on geographic location and the type and size of the home. For example, a Sacramento, California resident seeking coverage for a small, single-family home can purchase the Basic plan for $36/month and the Premier plan for $48.50/month. On the other hand, a multi-family home with three separate units costs $216/month and $298/month, respectively. You can request a free personalized quote for exact pricing.
First American Home Warranty’s costs are minimal compared to their coverage. Limits are straightforward and are the same for both plans (provided the plan you choose offers the specific type of coverage). Here are the limits for First American home warranties:
- Kitchen appliances. Coverage is limited to $3,500 per appliance.
- Plumbing. For diagnosis, access, repair or replacement of plumbing located in concrete, there is a $500 coverage limit.
- Geothermal heating systems. There is a $1,500 coverage cap for geothermal or water source heat pumps.
- Pre-existing conditions. Any malfunction or damage to appliances, systems, plumbing and HVAC before purchasing a First American home warranty is not covered.
Most major repairs — including those to heating, air conditioning and ductwork — have no coverage caps. The existing limits are typically high enough to cover the cost of any repair or replacement you might need. And there’s no “age limit” for appliances. They’re covered as long as they are functioning when you purchase the warranty.
For instance, if your refrigerator were to stop working, chances are you’d have no problem replacing it, considering the average cost of a refrigerator ranges from $1,000 to $2,000 in the United States. The $3,500 coverage cap is plenty to cover this cost. It’s important to note that First American will determine whether the refrigerator should be repaired or replaced in the first place. If a replacement is necessary, First American will select an appliance with similar features, energy efficiency and capacity, but they are not responsible for matching your brand, dimensions or color.
The average plumbing repair ranges from $175 to $450, and the average heating system repair ranges from $130 to $450. As with the refrigerator coverage cap, these limitations ($500) should be enough to cover the damages.
Keep in mind that these coverage caps may change. Make sure to read your contract thoroughly to understand your personal coverage caps.
Customer satisfaction
Consumer reviews offer insight into experiences others have with a particular company’s service. The Better Business Bureau gives First American Home Warranty a 2.35 star rating out of five based on customer reviews. Complaints center around slow response times, unexpected fees and unpaid claims. According to several reviews, the company can take days, weeks and sometimes months to respond to customer service requests and make repairs. Nonetheless, it’s important to remember that negative reviews are a minority in a vast sea of positive First American Home Warranty reviews. Trustpilot gives the company 3.5 stars out of five, with 60% of customers ranking their experience as five-star level. While some customers experience frustration with service and response times, the majority of customers who took the time to write reviews are satisfied with First American.
Legal action
Consumers should also be aware of a long list of small claims and class action lawsuits against First American Home Warranty dating back many years. Many of these suits included allegations of intentional and negligent misrepresentation, breach of contract and breach of the implied covenant of good faith and fair dealing. Many suits were litigated in small claims court and resulted in the company making a payment to their aggrieved customers. However, several cases reached federal and appellate courts.
In 2013, First American began adding mandatory arbitration provisions to new home warranty plans. By early 2014, all new First American Home Warranty plans included mandatory arbitration clauses to bar consumers from pressing claims against the company in class action suits and other legal actions.
Is First American Home Warranty right for you?
If you’re interested in protecting your home’s appliances and systems and you reside in one of the 35 states in which the company operates, you should definitely consider purchasing a plan from First American. Homeowners insurance typically doesn’t cover mechanical failures, so a home warranty protects you from unexpected repairs and replacements. Most First American customers filed at least one claim in 2021, and home warranty protection saved them a combined $219 million.
With a First American home warranty, you don’t have to worry about coverage caps on some of the most expensive repairs — a rarity in the industry. First American Home Warranty offers competitive pricing, with coverage that starts at roughly $1 per day. You won’t give up quality services in exchange for a reasonable price on a comprehensive plan; however, you will give up your right to hold the company to its promises in court. In sum, First American’s affordability and minimal coverage caps make it one of the best home warranties out there.
