Costco Home Warranty Review

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Quick Facts

Pros & Cons

My Verdict

The Costco home warranty has no deductibles or hidden fees. If the technician can’t repair your covered item, Costco will provide a brand-new replacement — never a refurbishment. 

Costco has built-in policies to protect you if a repair or replacement is significantly delayed. For example, if you have coverage on your refrigerator and its mechanical failure leads to spoiled food, Costco will reimburse you up to $300 for spoiled food.

Costco’s home warranty is through SquareTrade, an Allstate company. Allstate has a phenomenal company reputation with an A rating and accreditation from the Better Business Bureau and 4-star-plus ratings from third-party review websites like Trustpilot and Google Reviews. These excellent ratings bode well for how SquareTrade treats Costco customers. 

Each home warranty plan — called a “protection plan” — covers only one item or appliance suite, like a stove and microwave combo or a washer and dryer unit. Most home warranty plans are more comprehensive and may cover five or more appliances or home systems, with the most exhaustive plans out there covering as many as 20 or more appliances and home systems around your home.

You must be a Costco member to enroll in a Costco protection plan, which means paying an annual membership fee to access these policies. 

According to their terms and conditions, Costco’s protection plans have many exclusions, with some starkly contrasting with those of traditional home warranties. Perhaps most significantly, Costco’s plans exclude breakdowns due to normal wear and tear, whereas traditional home warranties are designed to cover breakdowns that result from regular day-to-day use.

Costco home warranties are only worth it if you’re looking for an extension to your manufacturer’s warranty on a single major appliance or appliance suite, such as your washer and dryer combo. Otherwise, consider traditional home warranty plans, which cover a much larger number of appliances and home systems if you’re looking for more comprehensive coverage should any of them fail.

Costco Wholesale is a members-only warehouse that sells everything from rotisserie chicken to bulk snacks to new, shiny appliances. As part of appliance sales, they provide home warranties through SquareTrade, an Allstate company. However, these home warranties are more like extended manufacturer’s warranties. Unlike most traditional home warranties, Costco only covers one appliance or appliance suite, such as your clothes washer and dryer, rather than a wide range of home appliances and systems, such as your home’s plumbing or HVAC.  While Costco is known for its generous sales of appliances and other home goods, are their home warranties worth it?

Unfortunately, the home warranty in general has a rough (and rightfully deserved in many cases) reputation. So, how do Costco’s “home warranty” plans stack up? If you’re interested in Costco’s appliance-centric plans, keep reading, and I’ll break down the pros and cons of this retailer. Our review team at Today’s Homeowner has scored Costco’s protection plans based on our unique review criteria, such as affordability, company reputation, claims process, transparency, and coverage — and don’t worry, I won’t hold back on my criticisms either. 

For more information, check out our Home Warranty Methodology page.

Costco Home Warranty: Bottom Line

I wouldn’t personally choose to purchase a protection plan from this company because each one covers only a single appliance (such as your refrigerator) or appliance suite ( such as your clothes washer and dryer). I’d rather pay a small monthly fee and have all my home’s appliances and home systems covered, especially pricey ones such as my HVAC system, which can cost over $10,000 to replace (and I definitely don’t want to be without an air conditioner in the hot summer). 

Costco home warranty plans don’t even offer the option for coverage on home systems, such as your plumbing, HVAC, or electrical, which are typical home warranty offerings, and you can’t enroll in valuable add-on protections. Add-ons such as roof leak coverage or protection for your pool or second fridge can prove invaluable when they suddenly break down and rack up hundreds or thousands of dollars in repairs. 

On the bright side, Costco plans have one-time fees ranging from $89.99 to $399.99 for three years of coverage, which is inexpensive when broken down monthly compared to typical home warranty premiums. So, this can be a decent option if you’re interested in coverage (essentially an extended manufacturer’s warranty) just for your new appliance or set of appliances.

Costco Home Warranty Plans and Coverage 

6.2/10

Costco offers home warranties through Allstate Protection Plans. They offer three types of coverage — single appliance, kitchen suite, and laundry suite — with varying levels of coverage based on the price of the appliance or appliance suite. You can choose from three single-appliance coverage plans, which cover prices up to $2,000 and more, or opt for suite coverage for kitchen and laundry appliances purchased at Costco. 

Unlike most home warranty plans, each plan only covers one item or a combined laundry or kitchen appliance suite, such as a washer and dryer or stove and microwave combo. You must purchase these plans within 90 days of buying the appliance or suite from Costco. By default, Costco covers its appliances by manufacturer or a technical warranty for the first two years. The Allstate Protection Plan kicks in for extended coverage from years three to five. 

Available Add-Ons

Unlike most home warranty companies, Costco doesn’t offer traditional home warranty plans with the option for add-on coverages for items such as water filtration systems and extra refrigerators. Each Costco protection plan is for a single appliance and doesn’t come with the option to add coverage in any way, lowering Costco’s overall score for plan options as it’s very limiting. 

Costco Home Warranty Cost & Affordability 

9.2/10

Costco home warranties rank well for affordability because you only pay a one-time fee for three years of coverage. During my secret shopping, I found that these fees can range from $89.99 to $399.99, which is quite a bit of money for one payment but averages out to $2.50 to $11.11 per month over three years. This is significantly less expensive than the average monthly home warranty premium of $50. However, it’s important to note that traditional home warranties typically cover five to 20 items in a single plan, so it’s like comparing apples to oranges. Overall, Costco is an affordable home warranty option if you want extra coverage on a single new appliance or appliance suite, like your sparkly washer and dryer combo, but don’t want a complete home warranty plan. 

Costco Home Warranty Customer Experience

7.6/10

Costco home warranties are only available for Costco members, limiting the pool of potential customers. However, like many of Costco’s services, this service is highly rated on third-party websites, such as Trustpilot and Yelp. You receive up to five years of overall protection as your Costco appliance automatically comes with two years of warranty protection, and the home warranty purchase extends this by another three years (five in total). As long as you purchase the appliance protection plan within 90 days of buying the appliance, you’re eligible to receive this coverage as part of your Costco membership. Unlike most home warranty providers, you don’t need a personalized quote — the process is super simple as everything has a flat, one-time fee. You also don’t have to worry about constant follow-up calls, which I’ve experienced with other home warranty companies after submitting information for a quote. 

Costco Home Warranty Company Reputation

9.6/10

Costco has a fantastic company reputation, especially when you consider how well SquareTrade, the Allstate company that handles Costco’s extended warranty, is reviewed. Allstate Protection Plans receives an A rating and accreditation from the Better Business Bureau, giving me a lot of faith in how they treat customers behind the scenes. Customers also rate this provider highly, with a 4.1 rating from Trustpilot and a 4.5-star rating from Google Reviews. I rarely see home warranty providers with ratings this high, so this is a real highlight for Costco. 

Positive customer reviews share that Allstate Protection Plans have fast claims resolution, exceptional customer service that truly listens to the customer, and high-quality repairs. In contrast, negative reviews share that they experienced claim denials, even when the customers had all the original receipts, which is worrying. 

Editor’s Note: The ratings provided were accurate at the time of writing.

Costco Home Warranty Claims Process

10/10

Costco has an excellent claims process, which SquareTrade, an Allstate company, conducts. You can file your claim at AllstateProtectionPlans.com/Costco or call the customer service phone number 24/7/365. When you submit your claim, have the original appliance receipt on hand, as you’ll need this information to complete the process. Costco shares that most claims are approved instantly, and then a customer service specialist will walk you through the next steps. This is an exceptionally fast turnaround, as many home warranty companies take 48 hours or more to approve or deny a claim, which is less than ideal when your dishwasher is leaking all over the kitchen floor. After your claim is approved, the specialist will schedule an in-home service visit. 

Costco Home Warranty Transparency & Ease of Use 

7/10

Costco lists protection plan terms and conditions on each of their appliance protection plan pages. You can view the document or download it, making it straightforward to review the specific fine print of your policy. In terms of exclusions, I find Costco’s to be quite extensive compared to most providers I’ve reviewed before. Costco has nearly 30 different exclusions that I found in a single appliance plan, which can quickly lead to this provider denying your claim if you can’t provide pictures and prove that you’ve kept up with routine maintenance. 

Exclusions

Costco has an extensive list of exclusions (listed below)  that can easily trip up the average homeowner. I’m most worried about the preexisting conditions and routine maintenance exclusion, as it can be challenging for homeowners to stay on top of all home maintenance flawlessly. In addition, I don’t like that damage caused by accumulation is an exclusion. This exclusion means that Costco won’t cover your appliance if the repair needed results from the accumulation of dirt, debris, and even body oil. I’ve never seen another home warranty provider with this exclusion.

• Normal wear and tear 
• Any and all preexisting exclusions 
• Natural flaws or inherent design or manufacturing defects
• Intentional damage
• Loss or theft
• Fraudulently described products
• Secondary or collateral damage
• Damage caused by weather conditions
• Improper electrical or power supply
• Improper equipment modification
• Vandalism
• Animal or insect damage
• Corrosion
• Battery leakage
• Act of nature
• Damage caused by “accumulation” (dirt, dust, oils, etc.) 
• Lack of maintenance or care
• Misuse or abuse of the product
• Damage caused by cleaning methods, products, or materials
• Defects due to the installation, hookup, or assembly of your product
• Damage caused by transit, redelivery, removal, delivery, or reinstallation of the product
• Claims made improperly or an incorrectly purchased protection plan
• Cosmetic damage
• Accidental or liquid damage
• Consumer-replaceable or consumable batteries, unless otherwise specified
• Products with removed or altered serial numbers
• Manufacturer defects or failures covered by the manufacturer’s warranty
• Damage to computer hardware, software, or data
• Any product that is sold “as is” 

Editor’s Note: While this article highlights certain exclusions, it’s imperative for readers to review their contracts as the mentioned exclusions are not exhaustive, and additional exclusions may apply.

Costco Home Warranty Flexibility in Service Providers

10/10

Costco receives a perfect score in this category because you can choose your own provider. Costco’s home warranty is done through SquareTrade, an Allstate company, and their claims specialist allows you to select your provider during the repair scheduling process. 

Costco Home Warranty vs. The Competition

Costco Home Warranty vs. Liberty Home Guard

Liberty Home Guard is one of the best-rated home warranty providers in the industry, with high 4-star ratings from third-party review websites such as Trustpilot. Customers consistently praise Liberty for their excellent customer service, which this provider shares with Costco’s home warranty department. However, Liberty Home Guard far outpaces Costco with their three plan options — all of which cover many appliances, major home systems, or both. Plus, you can choose from over 40 add-ons with unique coverage for things like carpet cleaning, window washing, pest control, and other helpful coverage like roof leak coverage. Costco doesn’t have this as an option, leaving you far less flexibility. 

Both of these providers allow you to choose your own service provider, which is a plus, and I find both of their claims processes straightforward and quick — although I do love that you can submit and track claims on a mobile app with Liberty. 

Overall, Liberty is my recommendation between these two providers unless you’re looking for an extended appliance plan on a single appliance you’ve purchased with Costco. 

Costco Home Warranty vs. American Home Shield

American Home Shield is one of my preferred home warranty providers because of their relative lack of exclusions. For example, you don’t have to worry about unknown preexisting conditions, normal wear and tear, or keeping routine maintenance records to have American Home Shield approve your claims. On the other hand, Costco’s appliance protection plans are strict about these factors, which could result in frustrating claim denials if you don’t stay on top of routine maintenance or are unaware of a preexisting condition that your new dishwasher had before the policy became active. 

In Costco’s favor, Allstate Protection Plans has a much better overall customer rating and reputation than American Home Shield. While the Better Business Bureau accredits both companies for their plans, AHS receives consistently low 2-star ratings on average from third-party review websites, while Allstate Protection Plans wins 3- and 4-star reviews on average, which is more reassuring. 

Still, I recommend American Home Shield if you’re looking for comprehensive coverage and fewer exclusions. 

Costco Home Warranty vs. Elite Home Warranty

Elite Home Warranty is a traditional home warranty provider offering three comprehensive plans with fantastic coverage caps of up to $6,000 for appliances and $10,000 for home systems such as your HVAC. Unlike Costco, Elite’s plans cover many home systems and appliances, giving me much greater peace of mind. If you’re only interested in appliance coverage, Elite’s Appliances plan covers the essential appliances in your home, like your fridge, clothes washer and dryer, dishwasher, oven, and more. Otherwise, you can opt for my preferred plan, their Elite Complete plan, a combination plan covering appliances and home systems, such as your electric and plumbing systems. You don’t have to purchase your appliances from Costco to be eligible for coverage with Elite, as they cover nearly all brands, excluding commercial-grade appliances. However, if you have luxury appliances, you’ll want to note that Elite charges a hefty service charge of $150 per visit for repairs on high-end appliances, while Costco charges no service fee. 

Overall, I’d recommend Elite Home Warranty if you’re interested in a wide range of coverage on multiple appliances. You can even choose a specific add-on for extra coverage on certain appliances and home systems to increase your overall coverage caps. 

Who is Costco Home Warranty Best For?

• Costco members wanting extra protection on a single, new appliance or appliance suite
• Landlords interested in an extended appliance manufacturer’s warranty
• Homeowners with all-new appliances who want to extend their manufacturer’s warranties

Costco’s “home warranty” is more of an extended appliance warranty on a single appliance or kitchen or laundry suite, like your washer and dryer combo. Their plans may suit you if you have all new appliances or want an extended manufacturer’s warranty. They may also be ideal for Costco members who invest in a high-end appliance and want extra coverage that can pay for a complete replacement should anything happen within the first five years of their purchase. If you’re on a tight budget and can’t afford a home warranty but want coverage on a single new appliance, the Costco home warranty gives you three extra years of protection, making it a unique option if the monthly fee of a true home warranty would be a financial burden.

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