Does Homeowners Insurance Cover Furnace Damage and Replacement?

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A standard homeowners insurance policy should help you pay to repair or replace your furnace if it is damaged by any peril that isn’t named in the policy as an exclusion. However, gradual damage generally isn’t covered, while damage from sudden mechanical failures is generally excluded unless you purchase extra coverage.

Keep reading to learn more about when homeowners insurance covers furnace damage plus how much you could have to pay for a new furnace without insurance coverage.

Key Takeaways

  • Home insurance policies often cover furnaces on an open peril basis, with covered perils typically including fire, explosions, sudden cracking, water discharge from other appliances and more.
  • Your policy likely won’t cover furnace damage that can be attributed to wear and tear, poor maintenance, flooding or earthquakes.
  • Basic homeowners insurance policies don’t cover mechanical or electrical breakdowns but these may be covered if you purchase an equipment breakdown insurance add-on.
  • Without insurance, the average cost to replace a furnace is $4,770.

When Does Home Insurance Cover Furnace Damage or Repairs?

Since built-in home furnaces are generally covered by the dwelling coverage portion of your home insurance policy, a standard policy should cover your furnace on an open peril basis, meaning your insurer will cover repairs after any cause of damage as long as it isn’t explicitly excluded by the policy.[1] Examples of perils that are usually covered include the following:

Fire or lightning


Windstorm or hail

Volcanic eruptions


Falling objects

Riot or civil commotion

Weight of ice, sleet or snow

Damage by aircraft

Water/steam discharge from home systems and appliances

Damage by vehicle

Sudden/accidental tearing, cracking, burning or bulging of home systems


Freezing of home systems

Vandalism or malicious mischief

Sudden/accidental power surges

If a covered peril ruins your furnace during the winter when you need your heating system to keep your house at a safe temperature, then your home may be deemed uninhabitable and your loss of use coverage may kick in to help you pay to temporarily move somewhere else.

However, you should note that your policy likely won’t cover gradual sources of damage to your furnace such as wear and tear or poor maintenance. In addition, some sudden perils such as floods and earthquakes are commonly excluded from coverage.

Does Homeowners Insurance Cover Furnace Replacement?

Your home insurance company will pay to replace your furnace after a covered loss as long as the replacement cost doesn’t exceed your dwelling coverage limit. It costs $4,770 to get a new furnace installed on average.[2] This should fall well below your dwelling coverage limit, which is often set at the cost to replace your entire home.

You should note that all dwelling insurance claims require a deductible, which is a set amount of money you must pay before your insurance company will contribute any money toward your claim. For example, if it would cost you $5,000 to replace your furnace after a covered loss and you have a $1,000 deductible, then your insurance payout would be $4,000.

furnace deductible

Is My Furnace Covered if It Has a Mechanical Breakdown?

A basic homeowners insurance policy generally won’t cover appliances that break due to sudden internal failures such as short circuits or mechanical breakdowns. However, you can receive coverage for this type of furnace damage by purchasing equipment breakdown insurance. It generally costs about $25 to $50 per year to add an equipment breakdown coverage endorsement to your homeowners policy.[3]

Do I Need Additional Coverage for Furnaces and Boilers?

Insurance companies generally don’t sell policies designed exclusively to cover residential furnaces and boilers, so all you should need to sufficiently cover the components of your central heating system are a standard homeowners insurance policy and potentially additional equipment breakdown coverage.

How To File a Homeowners Insurance Claim for a Furnace

You should take the following steps to file a homeowners insurance claim if your furnace has been significantly damaged or destroyed by a covered peril:

  1. Dial 911 if your furnace was damaged amid a crime such as a home break-in and ask the responding officers to fill out a police report.
  2. Begin the claims process by sharing preliminary information with your insurer and scheduling an appointment with an adjuster from your home insurance company.
  3. Record the damage by taking pictures or filming videos and acquire quotes for repairs from contractors in your area.
  4. Conduct emergency repairs as needed to keep additional damage from happening to your furnace.
  5. If you are still paying off your mortgage, call your lender to let them know you are filing a home insurance claim.
  6. Show the insurance adjuster evidence that supports your claim including pictures, videos, police reports and repair estimates.
  7. Organize and store documents that are related to your claim such as invoices and receipts.
  8. Take note of any updates to the status of your claim so you can address any issues that arise promptly.
  9. Use your insurance settlement to repair or replace your furnace or, if you believe your insurance company should pay you more, consider reaching out to a public adjuster or lawyer who can help you contest the settlement.
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Does homeowners insurance cover a bad furnace?

No, homeowners insurance does not cover furnaces that stop working due to poor installation and construction or regular wear and tear.

Are heating systems covered by home insurance?

Yes, built-in heating systems are typically covered by the dwelling coverage portion of a homeowners insurance policy.

How much does a new furnace cost?

New furnaces cost $4,770 on average but prices could range from as little as $190 to as much as $13,000 depending on factors like the type of furnace you get, how big it is and what the cost of labor is in your area.[2]

Does homeowners insurance cover HVAC systems?

Yes, home insurance generally covers heating, ventilation and air conditioning (HVAC) systems. HVAC systems are often covered by dwelling insurance but certain detachable components may be covered by personal property insurance instead.


  1. Lemonade Insurance. “Does Homeowners Insurance Cover Furnaces?” Accessed April 11, 2024.
  2. Angi. “How Much Does a New Furnace Cost in 2024?” Accessed April 11, 2024.
  3. The Hartford. “Equipment Breakdown Coverage for Homeowners.” Accessed April 11, 2024.

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