No one likes to clean up a spill, much less deal with a flood in their home. FEMA estimates that just one inch of floodwater in your home can cause $25,000 or more in damage costs. You might have to repair your property, replace possessions or pay for cleanup. You might wonder if you have insurance to cover the damage.
Homeowners insurance will cover certain water damage. All the same, most insurers heavily restrict water damage claims. Most policies don’t cover flood damage at all, in fact. So, to get ample protection for water damage, you might need to buy standard homeowners insurance, policy endorsements and a separate flood insurance policy. Let’s consider how each might apply to certain causes of water damage.
Standard homeowners insurance does not cover weather-related floods. Flood damage from heavy rain, river swells, storm surge and related events only receives coverage under flood insurance.
The flood insurance marketplace is a regulated entity. Most policies come from the federally-funded National Flood Insurance Program (NFIP). Certain homeowners must buy flood insurance if they live in flood zones. Coverage can provide coverage for your home and possessions up to certain limits.
One of a few exceptions homeowners insurance makes for weather-related flooding is for water that enters your home because of another hazard. For instance, if a tree falls on your home during a storm and lets water in, then homeowners insurance often pays.
When a pipe bursts, then homeowners insurance will usually cover your damage. The policy will work within the limits of your coverage to compensate you for the repairs. However, water damage from a leaky pipe will not have coverage in most cases. Most people can repair or prevent leaks and the related damage long before they become a problem.
On its face, homeowners insurance might not cover a sewer backup that overflows into the home. However, you might be able to add this coverage to your policy through an endorsement. Still, intentionally or mistakenly clogging your own sewers might not qualify.
Both homeowners insurance and flood insurance might cover for basement floods. Yet, both will usually restrict the ways they will compensate you. For example, flood insurance might pay to replace belongings damaged by the flood. However, it won't pay for structural for structural damage.
Always remember that though homeowners or flood insurance might cover these losses, they will include terms that could restrict when and how much they will pay you. Therefore, work with your agent to adapt your policy to your specific property. That way, you can make sure your policy always offers you the most effective protection.
Also Read: Flood Insurance for High-Value Homes