If you've purchased a home or are on the market for one, someone will mention the need for a home warranty policy. The big questions though are what they cover and whether or actually not you need one.
A home warranty is essentially an insurance policy that covers your home. This policy is not to be confused with homeowners insurance, which covers damages or losses to your entire home or possessions (think fire, flood, and the like).
A plan purchased when you first buy a new home can be beneficial because it can provide a buffer to fixing common problems that may arise, especially in that first year when you're adjusting to new appliances and a new environment.