Is Your Home Insured Against Damage from Water?

Will My Insurance Cover It? Yes. No. Maybe. The single most confusing element related to damage is what is and is not covered. Find out what you have, or don’t have, and learn what you need when it comes to damage and your insurance.

Continued from MN damage – Will Your Home Insurance Policy Pay For damage? Part 1 

We will try to clarify some of these points in this blog.

Common damage Insurance Scenarios

Here are some common causes of damage. Find out if you are covered by your insurance policy if you face any one of these common scenarios.

Scenario 1: If your water pipes froze due to the cold weather and burst, flooding your home with tap water.

In this scenario, most homeowners insurance plans will cover you on a conditional basis. If the house was unoccupied when the incident happened and the pipes burst because you forgot to turn on the heat before leaving, some policies may not cover the damage. This is because the incident may have been easily prevented had it not been for your negligence.

Scenario 2: Your washing machine or dishwasher overflows and floods your basement, laundry room, or kitchen.

In this scenario, the decision depends on the reason what caused the water appliance involved to malfunction. If the damage was accidental or was due to some defect in the appliance, your policy may cover the damage repair, but not the repair for your appliance. However, if the problem was caused by your lack of maintenance, your policy may not cover it.

Scenario 3: Your sewage system backed up and flooded your basement.

Basic home insurance policies do not cover basement floods caused by sewage damage. Most companies frown upon sewer backups because the water involved is black water or is highly contaminated. In fact, several policies specifically list sewer backups under its exclusions. Thus, if you want to be protected from this, you will have to pay extra for special coverage.

You can use the following list as a general guide to what is and isn’t covered or simply refer to the Summary of Coverage (PDF 108K) to help you better understand your policy and coverage.

Scenario 4: Water seeps through your basement foundation and damages your home’s foundation and basement interior.

Water seepage problems are not covered by homeowners insurance plans. This is because seepage only occurs if you failed to have foundation waterproofing installed before you had your house constructed. It is not considered as sudden and accidental.

Scenario 5: Heavy raining caused a nearby river to overflow and the flood enters your living room. It also damages some of your furniture.

This scenario is considered as flood damage, and is excluded from regular home insurance policies. If you want coverage for flood damage, you have to purchase an additional flood insurance rider. You also have the option to avail of federally provided flood insurance plans, which are offered by the National Flood Insurance Programs to communities participating in its floodplain management project.

You can determine if your property is eligible for flood insurance by checking the NFIP Community Status Book. For Minnesota PDF 49KB

Scenario 6: Fire damage

Another damage cause that almost all homeowners insurance companies frown upon is fire damage. Such damage is excluded due to the high level of loss they often entail. Like with flood damage, fire damage will only be covered if you purchased of an additional fire insurance rider on top of your basic policy.

Scenario 7: Mold damage after damage

Several insurance plans these days do not cover mold damage under their standard policies, even though the mold was a direct result of a covered damage incident. The company may pay for the repair and restoration, but may refuse to cover mold removal.
Mold usually begins developing within the first 48 hours after water floods your home. This means you have window of time during which you can immediately clean up the water and dry your home to prevent mold growth. The failure to do so in a timely or effective manner such that mold started to develop, then the mold problem will be considered as a result of your negligence, and not of the damage itself. This is the
reason why mold removal services are often excluded from damage coverage. If you were able to extract the water in time, you may receive mold prevention services from your damage emergency service provider; in this case, your insurance policy may cover the costs.

DIY or Hire A Professional damage Restoration Company – Which is Better?

When faced with the task of cleaning damage, homeowners have two options, either to do the repairs themselves or to hire a professional damage restoration service. If you decide to DIY, make sure you use the appropriate water and flood damage equipment so you will do the job properly and without compromising your safety as well as that of your home. However, if you want to get an approved damage insurance claim more easily, it would be better to hire a licensed damage company, especially one that is already trusted by your insurance provider.

This way, you will have access to inspection and analysis results as well as to official cost estimates and receipts, which will help support your damage insurance claim. In fact, some insurance companies and damage specialists do direct billing to save you the hassle. The damage company is already insurance approved and  will send the bill directly to your insurance provider, leaving you with nothing else to worry about.

Understanding Your Insurance Policy

In damage insurance, you should not assume. If you think you were at fault in the incident, most experts advise that you should still report the damage to see whether you may be able to get even restricted coverage. Likewise, even if the damage was sudden and accidental, do not automatically assume that your policy will cover it. Some homeowners immediately call for a damage emergency service without checking with their insurance company first. In the end, they learn that they can’t afford to pay for the repair service and their policy won’t cover the expenses.

It is your responsibility as a planholder to know and understand the full extent of your home insurance policy pertaining to damage. This way, you won’t encounter any unpleasant surprises.

[box] What used to consist of a contractor setting up a few fans in a flooded basement has now become a bona-fide science, largely in part to the greater understanding we now have of the serious negative health repercussions that can be caused by mold, mildew, and bacteria growth, and the better technologies available to tackle a water restoration job.[/box]