Is a Water Heater Blanket Worth It This Winter? Experts Explain the Real Benefits

When winter settles in and energy bills tick upward, many homeowners begin wondering whether small upgrades can make a meaningful difference—such as wrapping or insulating a water heater. The idea is simple: by adding a thermal, specially designed blanket around the tank, you can potentially reduce heat loss, help the appliance work more efficiently, and ideally, save money.

But is it actually worth it—and more importantly, is it safe? We turned to home improvement and insurance experts for their guidance. Here’s what to know before you bring home a water heater blanket this season.

Do Water Heater Blankets Actually Improve Efficiency?

A water heater blanket acts like a winter coat for the tank. If the tank isn’t well insulated, it loses heat to the surrounding air. This forces the unit to work harder, driving up energy costs.

According to Angie Hicks, co-founder of Angi, these blankets can have a real impact on efficiency. “Water heater blankets are a great tool to help reduce heat loss and lower your energy bills,” she says. “I recommend insulating your water heater if you live in a cold climate and are looking for a way to improve your energy efficiency.”

Courtney Klosterman, home insights expert at Hippo Home Insurance, agrees, noting that insulation can help boost energy savings in multiple ways. “Insulating your water heater and hot water pipes reduces heat loss, allowing water to reach temperatures two to four degrees Fahrenheit higher than uninsulated pipes,” she explains. “This lets you lower your water heater’s temperature setting, saving energy and reducing heating costs.”

Is Wrapping Your Water Heater Always Necessary?

Not always. The effectiveness of a water heater blanket mostly depends on the age of the unit and where it’s located. Older tanks or those installed in drafty or unheated spaces like garages and basements can often benefit from the additional insulation. And for homeowners in cold climates, pros say the investment is nearly always worth it.

However, newer water heater models often come with adequate, built-in insulation. If your water heater is fairly new, the tank is likely already well insulated. 

Hicks also notes that insulation can serve as a diagnostic tool. If you suspect your tank is losing a lot of heat, it might be a sign the appliance is nearing the end of its lifespan. “If you’re experiencing a lot of heat loss, it may be time for a water heater upgrade,” she explains. “New water heaters are significantly more efficient than older models, so consider upgrading if you’re looking for the most impactful solution.”

Safety Tips for Wrapping a Water Heater

Water heater blankets are generally safe, but their installation requires care. Hicks’s number one rule is straightforward: “Be sure to turn off the power or gas to the water heater before you install the blanket.” She also suggests calling in a pro if you’re uncomfortable handling the installation yourself.

After the blanket is in place, ensure you maintain clear access to:

• The thermostat
• The pressure relief valve
• Burner compartments (on gas units)

These areas should never be covered or obstructed. You should also call a technician if you’re unsure whether insulation is recommended for your model, or if you’re experiencing fluctuating water temperatures. A trained professional can determine whether insulation will help or whether repairs or an upgrade is the better long-term investment.

More Tips for Efficiency

Finally, Klosterman emphasizes that water heater care shouldn’t stop at insulation. "Your water heater also needs servicing to ensure your household gets clean, hot water throughout the winter," she says. "Flush your hot water heater if you haven’t already this year to minimize sediment buildup."

This combination—proper servicing, insulation, and a bit of maintenance—can offer real savings over time.