Water, water everywhere, but not a drop should be there. With dismay, you discover that your home is filled with damaging water. Will your insurance policy cover this loss? That depends on the type of insurance you chose to purchase and how the water entered your house.
There
basically are two insurance policies that deal with a homeowner's damage due to
water -- a flood insurance policy and a homeowners insurance policy. Losses not
covered by one of these policies may be covered by the other.
Knowing the losses
to which your home could be exposed will help you decide whether to buy one or
both of these insurance coverage.
While
insurance policies may differ in the coverage provided from homeowner to
homeowner, there often are basic features common to all policies. You should
ask your insurance agent or insurance company about the specifics of your
insurance policy. In the meantime, the Insurance Information Network of
California (IINC) offers the following general information based on standard
insurance policies.
FLOOD
INSURANCE
As
the name implies, a standard flood insurance policy, which is written by the
National Flood Insurance Program, provides coverage up to the policy limit for
damage caused by flood. The dictionary defines "flood" as a rising
and overflowing of a body of water onto normally dry land. For insurance
purposes, the word "rising" in this definition is the key to
distinguishing flood damage from water damage. Generally, damage caused by
water that has been on the ground at some point before damaging your home is
considered to be flood damage. A handful of examples of flood damage include:
- A nearby river overflows its banks and washes into your home.
- A heavy rain seeps into your basement because the soil can't absorb the water quickly enough
- A heavy rain or flash flood causes the hill behind your house to collapse into a mud slide that oozes into your home.
Flood
damage to your home can be insured only with a flood insurance
policy -- no other insurance will cover flood damage. Flood insurance is
available through your insurance agent, insurance company or local Federal
Emergency Management Office (FEMA). To determine if your home is located in a
flood plain, contact your county planning office. If you are living in a flood
plain, flood insurance may be an excellent purchase.
HOMEOWNERS
INSURANCE
A
homeowners insurance policy doesn't provide coverage for flood
damage, but it does provide coverage for many types of water damage to your
home. Just the opposite from flood damage, for insurance purposes, water damage
is considered to occur when water damages your home before the water comes in
contact with the ground. A few examples of water damage include:
- A hailstorm smashes your window, permitting hail and rain free access into your home.
- A heavy rain soaks through the roof, allowing water to drip through your attic or ceiling.
- A broken water pipe spews water into your home.
Even
if flood or water damage is not covered by your homeowners insurance policy,
losses from theft, fire or explosion resulting from water damage is covered.
For example, if a nearby creek overflows and floods your home, and looters
steal some of your furnishings after you evacuate, the theft would be covered
by your homeowners insurance because it is a direct result of the water damage.
However, the flood damage would be covered only if you have flood insurance.
It's
important to note that flood insurance and homeowners insurance do not
duplicate coverage for water damage. Instead, they complement each other.
It
is up to you to talk to your insurance agent or insurance company about flood
insurance and homeowners insurance, and then decide which insurance coverage
you need to protect your home, its contents and your family.
Water
can damage your house in many ways: a flooded river, rain through a leaky roof,
a pipe that burst in your bathroom. Homeowner's insurance doesn't protect you
against flood damage - -that requires a flood insurance policy -- but it does
cover other forms of damage that water can inflict. If your particular disaster
is covered, the policy will reimburse you up to the maximum coverage, less your
deductible.
Identification
For
the purposes of insurance, water damage is defined differently from flood
damage, according to the Insurance Information Network of California (IINC).
Water damage is defined specifically as damage caused by water that affects
your house before it touches the ground.
Types
Most
homeowner's insurance policies are classified as HO-2, which covers 16 types of
damage, or HO-3, which covers any damage not specifically exempt, such as
floods. Both policy types cover accidental water or steam discharges or
overflow from your plumbing, air-conditioning, heating or automatic
fire-sprinkler systems, or from appliances.
Effects
While
flood damage isn't directly covered by homeowner's insurance, the IINC states,
the effects of flood damage may be. If your home floods, for example, and
looters steal your property after your family evacuates, the theft is covered
even though it was indirectly caused by the flood.
Warning
In
California, a third of insurers refuse to renew policies of homeowners who made
one or two water-damage claims in the previous three years, Kiplinger's
Personal Finance states. Water damage claims may be small, according to the
magazine, but the administrative costs aren't. In addition, insurers worry that
water damage can lead to mold problems, which have resulted in huge problems in
the past.
Prevention/Solution
To
avoid getting canceled for small claims, Kiplinger's recommends, take the
largest deductible on your policy that you can afford. That will lower your
premiums and reduce the incentive to make small claims. Even if the damage is
slightly above your deductible, it might be worth handling it yourself to avoid
losing your policy.
Examples of What Types of Water Damage Your Home Insurance Policy Would Cover
Homeowners policies do not cover damages due to a flood, but they do cover other kinds of water damage. For example, they would generally pay for damage from rain coming through a hole in the roof or a broken window if the hole was caused by strong storm winds. On the other hand, if you have a hidden pipe leaking in your house and over time water damage occurs, that would not be covered.
It pretty much boils down to whether the water damage was caused by a covered peril such as a storm... if the water damage was due to you not keeping your house maintained and repaired then your insurance would not cover it. If you don't know what water damage is covered, review your home insurance policy or check with your home insurance company now, before any damage occurs.
Clean Up Your Water Damage to Avoid Mold
Regardless of how the water damage happened, it is important to take similar steps to remedy it. Never ignore indications of an obvious water problem in your home. You should immediately attempt to find and stop leaks at their source. When water leaks into your property, moisture can collect, allowing mold to develop. Mold can cause further damage to your property and can potentially cause health problems.
The adverse health effects from mold exposure can range from runny noses, coughs, nosebleeds, congestion, and sinusitis to more serious upper respiratory ailments such as asthma or bronchitis. A lot of insurance companies are restricting mold damage, but some mold damage may be covered if it was caused by a covered peril. You should immediately report any water damage to your insurance agent.
When a Storm Causes Water Damage
If sudden water damage occurs to your property, such as with a storm, it is important to dry all wet areas and provide air circulation to aid in the drying process. Also, cover any areas with a tarp to prevent more water damage. Covering, drying, and dehumidifying wet areas can help minimize the possibility that mold will accompany water damage. Always contact your insurance agent immediately to start the home owners insurance claims process.
Gradual Water Damage
What do you do if you find water damage that indicates leakage over a period of time? Unfortunately, mold may have already developed and more than likely your claim would not be covered. In this case, attempting to clean up the mold may spread the mold spores, causing greater property damage or health problems.
Mold can be dangerous to your health, therefore it is important that mold testing and cleanup be conducted by professionals as soon as mold is detected. Contact your insurance agent to see if any of your damage can be covered under your policy and contact a professional mold cleaning company.
A pipe burst in our bathroom, and a company came out to clean up the water throughout the house. I would like to know if there is a list somewhere of all the things I can ask my home insurance company to pay for. For example, what about my higher utility bills due to the use of blowers and dehumidifiers to dry things out? What about replacing all of my damaged property? How about the cleaning of air ducts, repainting and wall repair, and so on?
Someone told me that my shoes could be replaced. But what if I don't have a receipt to show their value?
I have been with my insurance company for 10 years and this is my first claim ever. I want to be sure that I'll receive whatever payment is owed to me for goods and services.
If it got wet, is it to be claimed?
-- Suzana
Dear Suzana,
When you have a loss like yours, the adjuster has to first determine whether or not the loss is covered, and second must consider the basis on which to value the damaged property: replacement cost or depreciated value (actual cash value).
Virtually all home insurance policies today cover water damage from a burst pipe. The only exception would be a frozen pipe that bursts because you failed to maintain heat in the building. That would not be covered.
Assuming your pipe was not frozen, your claim would be covered. (Note that if the pipe was old, the pipe itself is not covered because of wear and tear exclusions. But the resulting water damage is indeed covered.)
Homeowners policies cover only building and personal property that is actually damaged by the water. You ask "If it got wet, is it to be claimed? The answer is no. So, for example, if your carpeting can be dried out with no apparent damage, there is no claim.
As for valuing the amount of loss, structural damage is usually paid for on a replacement cost basis. That means if the carpeting could not be saved and even if it's several years old, your insurance policy would still pay to replace it with new carpeting. Water damage to walls and ceiling and the cost to repair or repaint are fully covered.
However, personal property that cannot be repaired or dried out is paid for on a replacement cost basis only if you purchased the optional replacement cost contents coverage. Otherwise, those losses will be paid on a depreciated value basis, meaning that you'll receive only what your used items were worth at the time of the damage. (Note that your shoes probably aren't covered if you wore them into the water.)
You are eligible for reimbursement of extra expenses, such as the increase in your electric bill due to the running of fans and dehumidifiers, under what's called "additional living expense" coverage.
I have two final suggestions: If you helped with any of the cleanup, make a note of your time spent and ask the adjuster for reimbursement; and be sure to have your contractor test for trapped water inside walls, between floors, etc. If water is found, the cost of dealing with it is covered by your policy. Trapped water leads to mold and eventual mold damage -- which has little or no coverage under most home insurance policies.
Does My Homeowner’s Insurance Cover Water Damage?
These are differentiated mainly by their premium costs and coverage restrictions. HO1 policies demand lower premium payments but carry high deductibles and may not cover certain types of damage to covered homes. HO2 policies are intermediate products that tend to have moderate deductibles and cover most types of damage. HO3 policies are the most generous and expensive form of homeowner's insurance. These policies have limited deductibles and carry plenty of perks that make them well worth their added cost.
There are some types of water damage that homeowner's insurance won't cover. Damage caused by natural flooding from an exterior source must be covered under a distinct flood insurance policy. Homes in dry climates or elevated areas away from natural sources of water may not require flood insurance policies. By contrast, homes in low-lying areas along rivers, lakes or oceans may require flood insurance.
The market for flood insurance is highly localized: In flood-prone areas where basements flood regularly, flood insurance can be ruinously expensive. This is also true in regions that regularly experience hurricanes and severe thunderstorms. In Florida, the flood insurance market is highly regulated to reduce out-of-pocket costs for the state's homeowners.
If your house sustains water damage during a weather event, a generous homeowner's insurance policy may cover your repair costs in certain circumstances. You'll probably need to show your claims adjuster that the damage occurred due to a defect in your home's construction. This line of reasoning might work to explain water seepage through a poorly-sealed window or weak point in the building's structure. It is less likely to be an adequate explanation for water that clearly entered the home through an open window or door.
Homeowner's insurance is more likely to cover water damage associated with faulty plumbing or appliances. Of course, this outcome isn't guaranteed. Before your provider will agree to pay your claim, you'll need to prove that the leak or flood was caused by poorly-manufactured water-bearing equipment or shoddy repair work on an existing water line.
Law Dictionary: Does My Homeowner's Insurance Cover Water Damage?
Will My Homeowner’s Insurance Cover Damage from a Leak?
Written by James Hirby | Fact checked by The
Law Dictionary staff |
The typical homeowner's insurance
policy covers the cost of sudden, accidental damages to the structure and
contents of a single home. If you have homeowner's insurance, your policy is
liable to pay for certain types of damage caused by storms, break-ins and
defective equipment. It may also cover fire damage. If you casually glance over
your written policy, you'll probably get the impression that its coverages are
quite fair.Unfortunately, your homeowner's insurance policy is probably rife with loopholes. Unless you have a particularly generous policy or have purchased supplemental insurance at some point in the recent past, your policy is unlikely to cover the cost of cleaning up after a leaking water pipe. It's also unlikely to cover the cost of repairing or replacing the offending pipe.
Even if the leaking pipe is decades old, the claims adjuster tasked with investigating the leak is likely to determine that the incident was the result of "poor maintenance practices." In other words, they'll tell you that you should have prevented the leak by repairing or replacing the pipe before its condition became critical. While it may be unreasonable to expect a homeowner to inspect each of the pipes in his or her house on a regular basis, the "maintenance excuse" is standard insurance-industry boilerplate.
If your home sustains water damage due to a leak from a worn-down pipe, you may wish to forgo the claims process entirely and take steps to ensure that the problem doesn't happen again.
On the other hand, your homeowner's insurance policy may pay for the cost of a leak that occurs suddenly and without reasonable cause. These sorts of leaks are typically caused by defective pipes or improper third-party maintenance. To ensure that your claim is honored in the proper fashion, be sure to keep all of the maintenance and purchase receipts related to your home's plumbing system. Even if your plumber was working some distance from its source, you may be able to prove that his or her negligence caused the leak.
There are two caveats to this general rule. Your homeowner's insurance policy may not cover the cost of damages that occur due to a leak in your home's external water line. If your yard is flooded, you'll probably have to clean it up on your own. In addition, you should expect your insurance premiums to rise after filing a claim for leak-related damages.
Law Dictionary: Will My Homeowner's Insurance Cover Damage from a Leak?
Is a Slab Leak That Causes the Foundation to Raise Covered by Homeowner’s Insurance?
Written by James Hirby | Fact checked by The
Law Dictionary staff |
As a homeowner, you'll
probably have to deal with dozens of unanticipated expenses during the course
of your tenure. Depending upon the age and condition of your home, you may have
to deal with such nightmares as electrical blowouts, insulation failures,
plumbing problems and landscaping issues. Many of these problems can be quite
costly. In the case of landscaping issues that involve dangerous trees or unsecured hillsides, these problems might have catastrophic implications for your home's integrity. Fortunately, your homeowner's insurance policy is designed to cover at least some of the expenses that arise from unanticipated damages or repairs to your home.
Depending upon its cost and "fine-print" details, your homeowner's insurance policy may cover a wide range of unanticipated problems. In fact, these policies are designed to pay for "sudden" or "accidental" damages to the structure or contents of the homes that they cover. They're less likely to cover repair costs that arise as a result of inadequate or negligent maintenance practices. For instance, your homeowner's insurance policy probably won't cover the costs associated with cleaning up kitchen mold created by a refrigerator that leaked slowly over the course of several months.
A slab leak can be particularly problematic. Like many home-related problems, these issues occupy a gray area that homeowner's insurance companies prefer to avoid. While some insurance providers may cover some costs associated with slab leaks, others might choose not to do so. Your provider's ultimate decision is liable to depend upon the specific circumstances surrounding your leak as well as the overall coverage scheme of your policy.
Several conditions might make it more likely for your leak-related claim to be accepted. If you can trace the genesis of the problem to a malfunctioning pipe, your claims adjuster may give you the benefit of the doubt and grant your claim. After all, a pipe that bursts while it remains on warranty is likely to be defective. You won't be held liable for any damages or repairs that occur as a result of a defective piece of equipment.
In addition, you may not even be held responsible for damages or repairs associated with freeze-related plumbing damage. If you can prove that your pipes were properly insulated, your insurance adjuster is likely to argue that their bursting was both "sudden" and "accidental." However, a slab leak that warps your foundation may not be covered in its entirety. Your claims adjuster might well argue that you should have noticed the damage to your home's foundation earlier than you did.
Law Dictionary: Is a Slab Leak That Causes the Foundation to Raise Covered by Homeowner's Insurance?
Will Homeowner’s Insurance Cover Damage to My Attic Caused by Snow?
Written by James Hirby | Fact checked by The
Law Dictionary staff |
If you're like most
homeowners, your homeowner's insurance policy is paid for with an escrow
account administered by your mortgage lender. While you have complete control
over your policy and are free to speak with a representative from you provider
at any time, you may go weeks or months without even thinking about your
homeowner's insurance coverage. Of course, you probably sleep easier with the
knowledge that you won't have to pay out of your own pocket for certain damages
to your home. There are three basic types of homeowner's insurance policy. Unless you live in a disaster-prone area or own a new, expensive home for which your mortgage lender insists that you provide top-of-the-line coverage, you probably have a "broad form" policy that covers some or all of the costs associated with a wide range of potential problems. Most "broad form" homeowner's insurance policies cover the cost of cleaning up and repairing damages associated with sudden weather events, car-striking-house accidents, vandalism, theft, neighborhood explosions, riots and malfunctioning appliances. In general, this type of insurance policy covers most events that can reasonably be considered "sudden" or "accidental."
Fortunately, rooftop snow and ice buildup generally meets this definition. Despite the fact that winter precipitation can build up on your roof over the course of many weeks and may only cause problems when it begins to melt or becomes particularly heavy in late winter, most homeowner's insurance providers will pay for structural damage or water-related issues that arise as a result. You'll be able to file a successful claim for problems ranging from a partially-collapsed roof to an electrical shortage caused by a persistent leak from your roof into your attic.
However, you shouldn't automatically assume that your homeowner's insurance policy will cover the cost of cleaning up or repairing damage associated with excessive snow and ice buildup on your roof without first contacting your provider. Some providers consider such buildups to be preventable and may only pay for a small portion of the associated costs. Others specifically exclude homeowners who live in certain regions.
If you live in a snow-prone region that sees massive snows followed by sudden springtime melts, you may wish to check the fine print of your policy to determine whether you're covered. Common "snow-prone" locations that may be excluded from coverage include high terrain in the Sierra Nevada, snow belts near the Great Lakes, and arctic or subarctic locations in Alaska and northern Canada.
Law Dictionary: Will Homeowner's Insurance Cover Damage to My Attic Caused by Snow?