Water Damage Insurance Definition
A risk-management product included in homeowners insurance policies that helps property owners limit their exposure to the cost of repairing property damage caused by water main breaks; overflowing washing machines, bathtubs and dishwashers; and leaking hot water heaters. Homeowners who want additional protection against water damage can purchase endorsements to a homeowners insurance policy to cover sewer backup, sump pump backup and water seepage (e.g., water entering your home when melting snow permeates your foundation).
No Canadian insurance company provides coverage for overland flooding.
Such a small percentage of homes face this risk that the price of a policy would be cost prohibitive because there is not a large enough pool of customers who can share this risk. Self-insurance, flood-risk mitigation strategies, and government assistance after a disaster are the only protections against this form of loss.
Example
Joe puts in a load of wash just before going to bed, and when he wakes up in the morning, he discovers that the washing machine overflowed and the surrounding flooring has been soaking in a pool of dirty, soapy water overnight. The flooring isn’t salvageable; he’ll have to replace it. Joe could choose to pay the replacement costs out of pocket, if they won’t be very high, but if they will be pricey, he can file a claim and ask his insurance company to pay it. He’ll still have to pay his deductible, but the total cost will be less than paying out of pocket.
Have more questions about Water Damage or Flood Insurance? Contact Us for more information.
First Foundation Tips
Water damage is a major source of homeowners insurance claims in terms of the dollar amount of claims. Homeowners can take a number of steps to limit their chances of needing to file a water damage claim:
- Check the roof for potential sources of leaks.
- Keep eaves troughs clear of debris to prevent water from overflowing and pooling around the foundation.
- Ensure that downspouts direct water away from all structures.
- Make sure doors and windows are properly caulked to prevent water penetration.
- Make sure pipes are sufficiently insulated and heated to prevent bursting.
- Turn off the water supply and empty the pipes before going on vacation.