Does home insurance cover plumbing issues?

Severe weather in 2024 caused a record $8.5 billion in insured losses across Canada, with water-related claims almost tripling compared to 2023. This is why understanding what your policy covers now can save you from out-of-pocket headaches later. If you discover a burst pipe or other forms of water damage in your home, your homeowners' insurance policy may help cover the damages, but it comes down to what caused the problem in the first place.

What's usually covered

Let's take a look at what plumbing insurance protects against:

• Sudden and accidental events, such as a burst pipe or leaking plumbing systems.

• Water damage to walls, flooring, and your personal belongings.

• Additional living expenses if your home is severely damaged and unsafe to live in.

What's not covered

On the other hand, plumbing insurance does not protect against:

• Homeowner neglect.

• Gradual leaks or long-term issues.

• Wear and tear.

• Flooding without overland water coverage or sewer backup coverage.

Quick tip: Install leak detectors or automatic shut-off valves to get a discount on your home insurance premium.

When your home insurance coverage doesn't cover water damage

Not all plumbing-related water damage is considered a covered peril in standard home insurance policies. If the problem that arose could have been prevented through ongoing home maintenance and care, your insurance claim may be denied. Take a closer look at what's specifically excluded from most home insurance policies:

Neglect & wear-and-tear

If you neglect your home and it falls into a state of disrepair, which is what causes the plumbing issue in the first place, your insurer is likely to cover you. For example, if the water damage that occurred was the result of a slow leak that you failed to repair early or normal wear and tear that could have been avoided had you properly maintained your home, your insurer is likely to deny your claim.

Flooding without additional coverage

Unless you added flooding insurance to your home insurance plan, such as in the form of overland water coverage for sewer backup coverage, plumbing damage caused by flooding likely will not be covered.

Mould-related issues

Mould damage and removal are typically not covered by homeowners' insurance unless you purchase an additional rider or endorsement.

Cosmetic damage

If water stains or warped flooring are the only damage that occurs, and no functional damage to your property is detected, your home insurance may not cover you.

Renovation-related damages

If your home is undergoing renovations, and you have not notified your insurance provider, and the plumbing damage occurs during renovations, your home insurance provider probably won’t reimburse you for the cost of repairs. DIY projects are also excluded from coverage.

Vacant-home exclusions

If your home is vacant for more than 30 days and you did not take proper precautions to prevent potential water damage in your home by draining water lines or arranging periodic check-ins, your insurance company may reject any resulting claim. Remember, home insurance coverage is designed for sudden and accidental events, not ones that are predictable or preventable.

What homeowners' insurance covers

Your homeowners' insurance will protect you against unexpected plumbing disasters in your home, but only in certain categories:

Dwelling coverage

If a burst pipe damages the physical structure of your home, such as the floors, walls, or ceilings, your dwelling insurance will kick in. This policy will also cover the cost of materials and labour required to restore your property and extends to detached structures on your property, such as garages, sheds, or pool houses.

Personal property coverage

Water damage to furniture, clothing, electronics, appliances, and other personal belongings will be covered by your home insurance policy up to your coverage limits. Personal property damage claims have increased by 115% since 2019, as have personal property repair/replacement costs, which have risen by 485%.

Note: High-value items may require additional coverage.

Additional living expenses coverage

If you need to move out of your home during repairs, additional ALE home insurance will cover the cost of accommodations, food, and transportation.

Additional home insurance coverage

Beyond standard policies, home insurance companies also offer add-on policies for additional protection:

Overland flood insurance

Overland flood insurance offers protection if your property suffers flood damage due to a nearby lake/river, overflow, heavy rain, or rapid snow melt.

Sewer backup coverage

Allstate Canada reports that repair prices for water-damaged basements increased approximately 20% between 2019 and 2024. Sewer backup home insurance covers damage that results from a sewer backup that causes your basement to flood with water from your sewer system or septic tank. Here's a quick summary table:

How optional home insurance policies help

With climate change and an increase in extreme weather conditions across Canada, having a comprehensive homeowners' insurance plan is more important than ever. This is why most homeowners opt for additional endorsements to enhance their level of protection:

Sewer backup

If you experience a sump pump failure in your home, it could lead to a flooded basement during periods of heavy rainfall. On average, sewer and floods from sump pump failures can lead to damages ranging from a couple of thousand dollars to repairs over $10,000. This extra coverage financially protects you should

Overland flood insurance

Flood insurance protects against water entering at the ground level of your home from heavy rainfall or overflowing lakes and rivers in your area. This is particularly crucial in flood-prone areas across Canada.

Discounts and detection tools

Installing leak detectors, sump pumps, and backwater valves can help reduce your homeowners' insurance premium anywhere between 5 and 15%, meaning more money in your pocket at the end of the day.

Common signs of water and plumbing damage

Early detection of plumbing problems and other water damage can help prevent the denial of your claim and more expensive repairs. Here's what to watch out for:

Stains or watermarks

If you notice stains, watermarks, or discoloured patches on your walls or ceilings, chances are water damage is the culprit. These stains may appear beige, yellow, or brown. They may also be arranged in a ring pattern.

Dripping sounds

The sound of running or trickling water at times when no one is using the water could indicate a plumbing leak. If you notice the sound of running water late at night when none of the toilets, sinks, or laundry machines are in use, this could spell trouble.

Peeling or flaking paint

If the paint is lifting off the surface of the drywall in any way, water damage likely isn’t far behind, and the affected area will only continue to grow if left untreated.

Swollen drywall

When water gets into your home, especially into the walls or ceilings of your home, the drywall will try to support it by absorbing it. This results in drywall that appears warped, soft, or even swollen.

Must odours

Take note if you’ve started to smell any new odours in the home, especially if you notice them in dark, damp parts of the home, such as in bathrooms, attics, or basements.

Visible mould

Mould is not only a hazard to human health, but it can also be a sign of serious property damage. Look for mould in dark crevices or corners, such as behind furniture or on baseboards. A new musty smell in your home could be a sign of mould related to water damage.

Increase in water bills

Have you noticed a jump in your hydro bills? Unless your water usage has increased drastically, a spike in your monthly utility bills could mean that you have a plumbing issue, such as a leak, or other plumbing problems on your hands.

Step-by-step action guide: What to do if you discover water damage in your home

If you identify plumbing damage, such as a burst pipe, leak, or other plumbing issues, here's what you need to do:

1. Stop the flow of water

Locate the water shutoff valve in your home and turn it off. Water shutoff valves are typically located in basements or near your heating system or air conditioning systems.

2. Document the damage

Document the damage. Take photos and videos of all the water damage, including minor or secondary damage.

3. Extract standing water

Use wet vacuums or pumps to remove standing water. The longer it sits, the more damage it will cause.

4. Call a professional plumber

Immediately call a plumber to assess your plumbing system.

5. Notify your insurance company

Contact your home insurance company and report the incident. Your insurance provider will begin your claim and ask you to submit evidence of the damage.

6. Begin repairs

Once your home insurance company confirms that your homeowners insurance covers plumbing repairs and other damage, you can go ahead and book a restoration company to perform the necessary repairs.

7. Get reimbursed

Your home insurance company will then reimburse you for your repairs.

Costs, claims & risk prevention

YouSet reports that water leak claims tend to cost between $9,000 and $12,000. Adding sewer backup or overland flood insurance will cost you an additional $150 to $300 annually. When you compare these costs, adding these additional homeowners' policies makes sense financially. Let's take a closer look at what you can do to prevent water leaks:

Risk prevention tips

Always make sure that you:

• Schedule annual plumbing inspections.

• Install shut-off valves and leak sensors.

• Insulate exposed pipes in your basement and attic to prevent frozen pipes.

• Drain outdoor taps during the winter.

• Keep gutters and downspouts clear of debris.

• Avoid pouring grease or debris down your drains.

Province-specific notes

Coverage for plumbing problems varies between provinces. In Ontario, Alberta, and British Columbia, sewer and flood insurance is optional. However, if you live in the Fraser Valley, low-lying plains in Alberta, or near one of the Great Lakes, flood endorsements are recommended.

Commonly asked questions

Some questions frequently asked regarding home insurance coverage:

Does home insurance cover gradual plumbing leaks?

No, homeowners' insurance covers sudden, unexpected water damage, not gradual plumbing damage.

Will submitting a plumbing claim raise my premiums?

Yes, filing a claim with your provider will increase your insurance premiums, especially if you have multiple claims on file. The best way to avoid filing claims is to perform preventative maintenance in your home year-round.

How long after the pipe burst should I file a claim?

You could contact your provider immediately. Most insurers require you to notify them within 48 to 72 hours. Delays may result in denial or reduced payouts.

Does liability coverage protect against damage from neighbour’s plumbing?

If your neighbour’s negligence causes damage to your home, their liability insurance may cover repairs. But proving fault is required.

Can I make a claim for sewer damage?

The only way your homeowners' insurance policy will cover sewer-related issues is if you opted to add a sewer endorsement to your standard plan.

Learn more with BrokerLink

Problems with your plumbing system can be stressful and costly. But with the right home insurance, you can have peace of mind knowing that you'll be protected financially against expensive repair bills. With water-related insurance claims reaching an all-time high, understanding how your policy works and what additional coverage you need is essential. If you need assistance understanding your homeowners insurance, or wish to add sewer or flood coverage to your current insurance plan, the experienced team at BrokerLink have got you covered.

We'll walk you through the process of updating your current policy and answer any questions or concerns you may have. To work with us, contact BrokerLink over the phone to speak with a broker directly. You can also get a free insurance quote using our online quote tool at any time!

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