Like most homeowners, you likely have homeowners insurance because it helps protect your investment (along with the fact that your mortgage lender requires it). Homeowners insurance covers your home and possessions in certain situations, including natural disasters, theft and fire. Your policy may cover your broken furnace too, but only under certain circumstances.
TL;DR (Too Long; Didn't Read)
Whether your broken furnace is covered by your homeowners insurance policy is dependent upon the circumstances in which it became broken. Typically, normal wear and tear is not covered; however, damage due to fire, theft and natural disasters is.
Furnaces and Policies
While homeowners insurance policies vary by state and company, they generally do not cover systems and appliances in the home that break due to age or normal wear and tear. This means that if your furnace broke due to age and wear, insurance will not cover it. Insurance often will provide coverage in cases of natural disaster, fire, or theft, though. If your furnace is broken or destroyed in one of those situations, your insurance company may pay to repair or replace it.
Coverage for Breakdown
Mechanical breakdown is not a covered cause of loss in most insurance policies, but many companies offer such coverage that you can add to your policy. This helps pay for equipment in your home that may break down because of age, wear and tear or mechanical failure. Coverage may include your furnace, air conditioning, water heaters, ventilation systems and even pool or spa equipment.
While your homeowners insurance may not cover the repair or replacement of your furnace, a home warranty likely will. The warranty acts like an insurance policy but is specific to appliances and systems in your home that are generally not covered by other insurance. If your furnace needs repairs, the home warranty company will provide a contractor who will repair or replace it when you make a valid claim. There may be exclusions or special requirements, so read your warranty thoroughly.
Furnace Causes Damage
Your homeowners policy may not cover your furnace, but it likely will cover damage caused by a broken furnace or household accident involving the furnace. For example, if a malfunctioning furnace caused a fire that significantly damaged your home, your homeowners policy likely would cover this damage. Likewise, if the furnace caused anyone physical injury, your homeowners insurance would provide liability coverage.
Kristen Radford Price began writing in 2005 for her campus newspaper. She has served as a feature writer for the life-and-style section of the "Daily Herald," a contributor to "Utah Valley Weekly," an editor for a small publishing house and now as director of communications for an Internet company. Radford has a Bachelor of Arts in journalism from Brigham Young University.