Does Homeowner’s Insurance Cover Water Damage?

Not all water damage is covered by homeowner’s insurance, and confusing it with flood damage can be a costly mistake.

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A standard homeowner’s policy may cover costs associated with water damage. However, not all types of water damage are covered. Flood damage isn’t covered by a standard homeowners’ insurance policy.

It’s important to understand the difference between water damage and flood damage so you know exactly what’s covered when you have a loss. There are also some exclusions to water damage coverage that are outlined in your policy.

Water Damage vs. Flood Damage

It’s important to remember that water damage and flood damage are two different things, but distinguishing between the two can be confusing.

According to Nationwide Insurance, the primary difference is that with a flood, the water comes from a natural source. The source could be a lake or a river.

Although rain may seem like a natural source, it must enter your home through a covered peril, such as a wind-damaged roof or a broken window. In other words, if the wind blows your roof off and the rain from the storm damages your home and belongings, your homeowner’s insurance will probably cover it.

But if the rain causes the creek behind your house to rise and it floods your house, there wouldn’t be any coverage on a standard insurance policy. You will need to have flood insurance.

According to Ruby Home Luxury Real Estate, about one in 60 insured homes makes a claim for water or freezing damage every year. The average insurance claim for water damage is $13,954.

Water damage is a major problem and the most common home insurance claim, after hail and wind damage. It affects around 14,000 people every day.

Flood damage is also pervasive. Ninety-nine percent of U.S. counties were impacted by a flood even between 1996 and 2019.

Standard Homeowner’s Policy Coverage

Homeowner’s insurance typically covers sudden and accidental incidents. If the incident was unexpected and couldn’t have been prevented by adequate preparation, there’s a chance your homeowner’s policy will cover it. For example, if frozen temperatures cause a pipe to burst and flood your home, you will probably be covered.

Another sudden event would be if your dishwasher or washing machine broke while in operation, causing water damage. Your policy would probably cover the damage, but it wouldn’t cover the broken appliance.

According to Allstate, the broken appliance would be considered the source of the water and, therefore, not covered.

The same goes for the toilet that breaks. The damage would probably be covered, but toilet replacement or repair would be your responsibility.

If, however, it was determined that there was a lack of maintenance on the appliance that caused the problem, your insurance may not provide coverage for damages.

According to Travelers, a water-line break may be covered if it has undergone sudden and significant damage. For example, if you dig up your yard and accidentally damage the water line running from your meter, repairs and cleanup may be covered under your policy.

However, if the water line breaks due to wear and tear or poor initial installation, shifting soil, pests, or encroaching tree roots, you will be responsible for the damage.

Water Backup From an Outside Sewer or Drain

Water backup from an outside sewer or drain is not covered in a standard homeowner’s insurance policy. However, you can purchase an endorsement for this coverage.

Water Damage Not Covered on a Homeowner’s Policy

Most policies won’t protect you against gradual damage. This is considered “wear and tear.” For example, if your kitchen sink has been leaking for several months, your homeowner’s insurance may not cover the resulting damage.

Flood Is Not a Covered Peril

According to Ready.gov, floods are the most common disaster in the United States. A flood means any water that flows into your home from the ground. So, rainwater, a surging river, or saturated ground are not covered.

The exception, as mentioned previously, is if rain entered your house because of a covered peril. For example, if the wind blew off your shingles and the rain immediately damaged your home or belongings.

Groundwater Seepage Not Covered

Often, older homes with basements will have problems with water seeping through walls or foundation cracks. But like flooding, groundwater seepage isn’t covered by a standard homeowner’s policy.

Although a sump pump may help, it can back up, too. Unless you have a specific endorsement for sump pump backup on your standard homeowner’s policy, you may not have coverage for damages.

Sewage Water Not Covered

Water that overflows from sewer pipes or drains and comes into your house isn’t covered in a standard homeowner’s policy. However, you can purchase an endorsement for your policy.

Poor Maintenance

If you’ve neglected the plumbing or appliances in your house, the water damage stemming from their failure may not be covered by your policy.

Water Damage a Threat to Your Home

Water damage is a threat to your home and can greatly impact your finances. You can reduce the potential for losses by scheduling regular home maintenance. Take care of repairs immediately.

Talk to your insurance agent to ensure you have the proper endorsements and that you understand your coverage. Consider purchasing flood insurance.

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