Homeowners Insurance: Uncovered
Water, Water, Everywhere. One of the biggest questions we face in the insurance industry is coverage for water. Unfortunately, the standard homeowners policy provides very limited coverage for water. I will take some time to explain the different sources for water damage and then provide some options to broaden your coverage. Your homeowners policy will never provide coverage for flood water. A flood is defined when water effects your property and an adjacent property. It is possible to purchase flood insurance but it is usually very expensive. The next source of water can come from the surface or your land or the ground. Once again, there is no coverage for surface or ground water and there is no way to purchase coverage. In the event that a pipe or part of your plumbing system inside your home fails, there would be coverage for any damage caused by the water but not coverage for the plumbing repair or the actual cost of the water.
Another unwelcome water source in your home could be the backup of the water or sewer line, or the failure of your sump pump. We are seeing this type of claim occurring on a much more frequent basis. Some policies provide a very minimal amount of coverage (up to $5,000) for this type of loss. It is possible (and highly recommended) that you increase (or add) coverage for back-up of water and sewer to your homeowners policy. We recommend a minimum of $10,000 or more of coverage, especially if you have a finished basement. The last thing you want to find out when your basement is full of other people’s waste water is that you do not have enough (or any) coverage.
Call us today to review your policy and discuss your options to ensure proper protection.