That's the way warranties work. Warranty providers are not offering them at a loss.
If you buy a home warranty, or an extended warranty for your car, you are (on average) going to be out of pocket more than you would be without it. You are buying it for the peace of mind that comes from not having to deal with an unlikely but major repair expense.
Not at this price. Usually the warranty is a percentage of the price of the goods. So for example, I expect a $1000 gadget to have extended warranty priced at $100 or so. I have never seen the warranty of a $1000 gadget to be priced at $3000 to $5000 dollars. And that is for stuff that break down more frequently, e.g. phones and laptops and cars. The odds of a furnace breaking down are even lower.
I think the “party line” response to this would be that the warranties you get include preventative maintenance as well, making it a different proposition - you’re not just buying a warranty, but a full service plan after all. But I’ve never been convinced by that argument.
I just went through buying a furnace and had a few prospective installers. The first tried to sell the extended coverage: twice annual “checks and maintenance” and a 30% discount on all parts.
The second said he’d let me source the parts myself if I so desired and if I would be responsible for changing the air filter on schedule and hosing down the outside fan every summer I’d be better off putting the annual fee into a sinking fund. Or, I could pay him $200 a year to hold a hose, money he’d happily take. He got the job. ;-)
If you buy a home warranty, or an extended warranty for your car, you are (on average) going to be out of pocket more than you would be without it. You are buying it for the peace of mind that comes from not having to deal with an unlikely but major repair expense.