The short answer
Homeowners insurance helps pay for sudden, accidental damage to your home and belongings, like hail, wind, fire or a burst pipe, plus liability if someone is hurt on your property. A home warranty, called a residential service contract in Texas, helps pay to repair or replace covered systems and appliances that break down from normal wear, like an HVAC unit, water heater or dishwasher.
Your lender will require insurance if you have a mortgage. A home warranty is optional.
What insurance does and doesn't do
A standard policy covers named perils or open perils depending on the form, minus your deductible. In North Texas, wind and hail deductibles are often a percentage of the dwelling coverage, which can be much larger than a flat deductible. Read that line carefully.
Insurance generally doesn't pay for wear and tear, maintenance, or gradual problems like a slow leak. Flood usually requires a separate policy.
What a warranty does and doesn't do
A home warranty typically charges an annual fee plus a service call fee each time a technician comes out. Coverage depends on the contract: which systems are included, the dollar limits per item, and exclusions for pre-existing conditions, improper maintenance or code upgrades.
In Texas, residential service companies are regulated under the Occupations Code. Before buying one, read the sample contract, not just the brochure, and check how claims are handled and how you choose a contractor.
Do you need both?
If your HVAC, water heater and major appliances are older and you'd struggle to pay for a sudden replacement, a warranty can smooth out those costs. If systems are newer or you keep a repair fund, you may decide to self-insure instead. Insurance is a separate decision and, with a mortgage, not optional.
Buyers sometimes ask a seller to pay for a first-year warranty as part of the contract. That's a negotiation point, not a requirement.
Shaune Corbett Group's buyers also have access to the 2-Year Home Buyer Guarantee, which addresses a different worry: buying a home you end up not loving. It isn't a repair warranty or insurance. Eligibility requirements, terms, conditions and limitations apply to every guarantee. Full terms are provided in writing before you sign anything.