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What’s Covered? Water Damage and Insurance

Over the past nine years water damage claims have risen to become 50% of all home insurance claims. Water damage can be costly and difficult for property owners and renters to recover from. Many people assume their insurance policy will cover water damage but there are different kinds of water damage, which may or may not be included in a standard property insurance policy. We’ve created a quick guide to help explain how each kind of damage could occur and what it means for your insurance.

Water Damage
Your property insurance should include coverage for any sudden or accidental discharge of water in your home. This includes coverage for water line breaks or if any of your appliances overflow or leak. You are also covered if hail or wind causes a hole in your home through which water enters and causes damage. An easy way to know whether the damage to your home qualifies as water damage is to consider the source of the water. For insurance companies, water damage refers to damage caused by “clean water” or water that hasn’t entered your home from the ground or sewer.

Sudden and accidental bursts of plumbing pipes and appliances are covered by residential insurance policies, but there are specific policy requirements and limits for these situations. If you are going to be away from home for more than a day, be sure to turn off your main water supply and appoint a caretaker to check your house regularly. If you don’t, your property insurance policy may not respond to a loss, meaning any water damage claim as a result of frozen or burst pipes could be denied. Each policy has different requirements in terms of inspection frequency and water supply. If you’re heading on vacation or away on business, your BrokerLink broker can confirm what your specific policy requirements are to ensure your coverage remains valid.

Sewer Back-Up
In contrast to the “clean water” of water damage, sewer back-up involves damage caused by “dirty water”. This includes any water coming into your home from pipes, drains, septic tank, eaves troughs or down spouts. Sewer back-up can happen for a variety of reasons but the most common is when rain or melting snow overwhelms the city sewer system.

Sewer back-up coverage is not included in your property insurance policy but can be added as an optional coverage. Homeowners in some areas are more likely to require this coverage as their homes may be more vulnerable to flooding and back-up. The cost of adding this coverage can be minimal compared to the cost of repairing your home and additional living expenses if you cannot reside in your home. If you’d like to learn more about sewer back-up coverage, be sure to call your local BrokerLink broker.

Overland Flooding
Overland flooding refers to any situation where water overflows onto dry land from a body of water, causing damage to homes and cars. This kind of water damage made headlines last year when Southern Alberta experienced flooding from overflowing rivers due to heavy rainfall and rapidly melting snow.

There is currently no insurance coverage available in Canada for overland flooding. According to the Insurance Bureau of Canada, this is because only a small percentage of the population is at risk for overland flooding. Those who are most vulnerable are those living in areas prone to flooding, such as flood plains or near lakes and rivers. Since the majority of homeowners aren’t exposed to this risk and would not share in the cost of the coverage, it becomes too expensive to provide flood insurance for homeowners who would need it.

Now that you know the different kinds of damage caused by water, how can you protect your home and your belongings?

Inside your home
• If your home was built before 1950, make sure you don’t have any galvanized pipes. This type of plumbing has a lifespan of 50 to 75 years and corrodes easily, leading to leaks and bursting.
• Keep an eye out in the bathroom. Small cracks in your tub and shower grouting can allow water to penetrate the walls which can cause rot and mould.
• Install flood-prevention devices. Not only could they protect your home, but they could qualify you for a discount on your insurance. For a quick guide to these devices, click here.
• After a rainstorm, check your basement. If you find any water, it may mean you have foundation cracks needing repair or your draining system needs to be replaced.
• Most washers come with rubber water hoses which can burst as they age. Inspect the hoses regularly for cracks or signs of wear. If you can’t remember when they were last changed, it’s a good idea to replace them.
• Keep a record of your belongings using our home inventory checklist. Having a list of items can be extremely helpful in case you do sustain water damage and need to file an insurance claim. Consider storing valuable items on higher levels of your home since the basement is one of the parts of your home most vulnerable to water damage.

Outside your home
• Shovel snow away from your home and make sure there aren’t any banks building up against the sides. The goal is to keep any melting snow away from your foundation as it can seep into your basement.
• Check to see which way the ground slopes around your house. If the ground slopes towards your home, water can pool next to your foundation after a rainfall or thaw.
• Clean your gutters and eaves troughs clean and make sure the water is draining away from your home.
• Inspect your roof for worn or missing shingles as well as any areas where the metal flashing is bent or unsealed.
• Make sure you always turn off exterior water lines from the controls inside the home and drain the water lines to the outside any time the weather drops below zero.

Your home is likely your most valuable asset so you want to make sure it’s protected. If you have any questions about the different types of water damage, your home insurance policy or flood prevention devices, we’d be happy to answer them. Visit your local BrokerLink office or give us a call today.