Does home warranty cover water heater replacement or repairs?

Published Date: December 20, 2022


Yes, home warranties cover water heaters; including the repair and replacement of your water heater under their regular plans.

However, before you subscribe to a home warranty or make a claim for repair or replacement, you need to understand the policies of the warranty provider. You’ll have to check the items they cover, the coverage limit, the service fee, etc. You can learn all these important points from this article.

What types of water heater damage does home warranty cover?

What Types Of Water Heater Damage Does Home Warranty Cover?

Home warranty will cover damages and replacements of gas, electric, and tankless water heaters and the components/parts that are mentioned in the agreement, as well as damages due to normal wear and tear. Following are the parts & components that most of the top home warranty companies cover:

  • Circulating pumps
  • Control board
  • Thermostat
  • Gas valves
  • Burner assembly
  • Heating elements
  • Pressure switches
  • Thermocouple
  • Ignition module
  • Igniter
  • Pressure temperature relief valves
  • Drain valve
  • Instant hot water dispenser
  • Dip tubes
  • Blower motor
  • Heat exchanger
  • Coils attached to boilers

When it comes to improper installations and pre-existing conditions, home warranty companies may or may not cover them. The same goes for the damages due to sediments, rust, and corrosion.


Some warranty providers don’t cover units exceeding the capacity of 75 gallons. Considering most domestic water heaters have a capacity below 75 gallons (i.e.30 gallons, 40 gallons, or 50 gallons), it shouldn’t be a problem. You will also find that a few of them don’t cover tankless water heaters, circulating pumps, pressure valves, or malfunctions due to sediments. You should always check the terms and conditions in your contract before making any claims.

What about coverage for old water heaters?

When you apply for a home warranty, some companies might require a home inspection of all appliances/systems to record the wear & tear and pre-existing conditions. American Home Shield and Select Home Warranty are two of the companies that cover water heaters that are old and have pre-existing conditions.

When Will The Company Replace Your Water Heater?

When Will The Company Replace Your Water Heater?

If the company’s contractor declares the system unrepairable, your water heater is eligible for replacement. The warranty provider may replace the system’s components or the whole unit with a new one if they deem it appropriate. However, even if the water heater is eligible for replacement and you followed the instructions from the company, the final decision on replacement is at the company’s discretion.

Can The Company Deny Replacing My Water Heater?

A home warranty company may deny your replacement claim if the broken/malfunctioning components are not covered under the contract. You may refer to the above table for the list of covered parts.

Apart from the above-mentioned condition and the components not listed in the table, your claim could be denied for the following reasons as well:

  • Replacement cost exceeds the coverage limit
  • Malfunction due to lack of maintenance
  • Damage caused by improper handling
  • Problems caused by an unprofessional technician or by yourself trying to fix it
  • Building code violation/wrong code upgrade or improper installation


Building codes: A set of rules established to protect public health and welfare and safeguard the infrastructure from potential hazards.

How much does a water heater damage cost to fix?

How Much Does A Water Heater Damage Cost To Fix?

Fixing a water heater can cost you from $150 to $1000, depending on the problem, the broken parts, and the technician you choose. And for replacement, the cost is even higher. The average cost of repairing a water heater is about $547, and for replacement, it’s $1,485.

You can classify the water heaters into hot water heaters, tankless water heaters, gas water heaters, and electric water heaters. Repair and replacement costs vary based on this category. 

Water heater type

Repair cost

Replacement cost

Hot water heater

$197 – $876

$931 – $4789

Tankless water heater

$255 – $1978

$800 – $4750

Gas water heater

$100 – $675

$600 – $2700

Electric heater

$100 – $500

$500 – $2550

Note: The cost of repairing or replacing your water heater will depend on the labor and service fee as well as the plumbing work involved. 

How much do I have to pay for home warranty?

Home warranty plans start as low as $27.99 per month and go up to $60. And homeowners who subscribe to home warranty companies can save a lot when their appliances break down. Repairing and replacing the components requires you to pay the service call fee, which ranges from $60 to $70 and can go up to $125.

Subscribe to the warranty provider that offers good and quick service and has a higher coverage limit. For example, American Home Shield offers $3,000 per covered item and $6,000 if you opt for a premium plan, which is more than enough to repair or replace any of your appliances. In case the repair or replacement cost goes beyond the coverage limit, you’ll have to pay for the extra expenses.

Best Home Warranties For Water Heater

We have picked the top 3 home warranty companies for water heater coverage. These were picked based on their coverage of water heaters, discounts offered, special features, etc. We’ve listed the best companies below:

Best for contractor network

offer_iconOffers - $50 off on additional/multiple properties $25 Amazon gift card on referrals

  • Higher coverage limit
  • Covers improper repairs & installation
  • Covers old appliances & systems

Covered parts -Components and parts of conventional water heaters (and their tanks), Components and parts of tankless water heaters, Water heater circulating pumps

Lowest service fee

offer_iconOffers - $150 off on all plans 2 extra months free

  • Free roof leakage coverage
  • Discount on multi-year plans
  • 60-day workmanship guarantee

Covered parts - Control board, Thermostat, Gas valves, Burner assembly, Heating elements, Pressure switches, Thermocouple, Ignition module, Igniter

Best for comprehensive coverage.

offer_iconOffers - First month free

  • Guaranteed response within 24 hours
  • Guaranteed service work order for 90 days
  • Fast response to call

Covered parts - All components and parts, including tankless water heaters and circulating pumps

How will I know if my water heater isn’t working properly?

How Will I Know If My Water Heater Isn’t Working Properly?

You will see certain signs when your water heater is not working properly. Such as:

  • Inconsistent temperature: It is a clear case of the thermostat malfunctioning. You need to replace the device immediately. If the heating elements are broken, it is a serious issue that may cost more to repair or replace.
  • Strange noises: If your heater is making strange noises, it means the parts are loose or broken. There’s also a probability of sediment clogging the system. You need to flush the water from the system to find out whether it’s an internal problem, sediments, or something else.
  • Age: Age is a big factor when it comes to water heaters. The usual lifespan of a heater is 10 years, and some may go a few years beyond that. However, water heaters older than 10 years tend to break down frequently if you don’t do proper and regular maintenance.
  • Water is discolored: Rust is the main reason for the discoloration. The corrosion of a water tank is common as it nears the end of its lifespan. The rusting of the coating is harmful to health and must be replaced or fixed. If you have a tankless water heater, the discoloration could be because of the pipeline or the source of water.
  • Leakage from the heating tank: Water pooling under the unit or water dripping from pipes are signs of valve malfunction.
  • Low water pressure: This again is an issue of sediments clogging the system.
  • Low heating capacity: This could be an issue with a broken dip tube. When this component cracks, it releases the cold water into the hot water, mixing them and causing inconsistent heating.
  • Incorrect installation: Improper installation can cause serious issues. You will see a pool of water under the heater if the plumbing is not done properly. The temperature and pressure will be too high or too low if the pressure relief valves are not installed accordingly, and there will be frequent short circuits if the wiring is exposed to the water.

How to file a claim for water heater damage?

How To File A Claim For Water Heater Damage?

To make the claim, you must follow the steps outlined below:

Cross-check the warranty coverage

Read the company’s terms & conditions and the appliances covered. Check whether the water heater is covered under the home warranty, as well as its coverage limit. Learning all this information will help you discuss the issue with the company’s representative and the contractor.

Call the company’s customer service

If your water heater breaks or malfunctions, you should contact the company using the given phone number or file a claim on their website. After this process, they will send the service technician for inspection after checking your availability.

Pay the service fee

This is the last step from your side. Upon payment of the service fee, the company assigns a local contractor to diagnose your water heater. He’ll pay a visit after setting up an appointment with you. He will inspect the problem and suggest either repair or replacement.

If the total cost of repair or replacement exceeds the company’s coverage limit, you may be required to pay the difference out of your pocket.

The Bottom Line

A water heater is a necessary appliance for a household, and its malfunction could cost you time and money. When this happens, your home warranty will help in repairing and replacing faulty components. And, if you haven't subscribed to one, you should choose the one that meets your requirements and budget. A home warranty will give you peace of mind and financial security when the water heater breaks down.

Frequently Asked Questions (FAQs)

How long is a water heater warranty?

If you subscribe to a home warranty, it will cover your water heater for one year. And if you are satisfied with the service, you can continue the subscription.

Will American Home Shield replace my water heater?

Yes, American Home Shield will replace your water heater.

Should I buy an extended warranty on a water heater?

An extended warranty for a few more years may sound like a good idea, but it costs you a couple of hundred dollars every year. Having a home warranty could help you keep repair and replacement costs to a minimum.

Does First American Home Warranty cover hot water heaters?

Yes, First American Home Warranty covers hot water heaters.

How should I protect my water heater from damage?

To keep your water heater in good condition, you have to do the following things:

Clean the tank: Keeping the tank clean will prevent sediments/debris like small rocks, silt, and sand from clogging the system. It also prevents corrosion.

Ensure the flood stop system works: It’s a device hardwired to the electrical system with a backup battery that shuts down the system when it detects water near it. It also has an alarm to warn the homeowner.

Keep the T&P valves in working condition: The temperature and pressure valves help an overpressured system release pressure automatically.

Check the anode rod: This heating element is made of metal and can corrode after some time. Replace if there is corrosion every two years.

Insulate the pipes: During the winter, it’s necessary to insulate the pipes; otherwise, it takes longer to heat the water, which increases your energy bill.

How Long a Water Heater Actually Lasts?

A water heater usually lasts for 10 to 15 years with proper maintenance and regular servicing by a qualified technician.

Does homeowners insurance cover water heaters?

No, homeowner’s insurance doesn’t cover water heaters unless they are damaged by perils such as fire, lightning, or other natural hazards.

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