Flood Insurance Q&A: Do you really have it?
Homeowners who assume that flood coverage is included in their standard homeowner’s policy will be in for a rude awakening (and hefty out-of-pocket costs) should rain waters start to rise in their neighbourhood. Flood coverage often gets overlooked by homeowners until it’s too late. We strongly caution against skipping important supplemental coverages without carefully considering them. Most standard home insurance policies come with limited coverage for water damage. With extreme weather events making flood damage increasingly common (to the point that water has surpassed fire as the leading cause of home insurance claims), it’s crucial to determine how your insurance policy would respond to a water claim.
We’re here to answer some common questions about water coverage. Note that specific coverages vary by location and insurer. Ask your broker what your policy covers and what additional coverage is available.
What kind of Water Damage is covered by my Basic Home Insurance Policy?
Spills, burst pipes, or accidental overflows. Most standard home insurance policies cover water damage caused by things inside your home (pipe bursts). Sudden and accidental come into play with spills and other indoor water mishaps. If you were filling the bathtub for the kids’ bathtime, the phone rang, the doorbell rang, and the dog ran out when you opened the door. When you finally remembered the filling bathtub, it was too late as water started coming down the stairs. A standard home insurance policy can help cover the water damage due to the overflow. Still, the damage caused by water entering your home from external sources (heavy rainfall, a sewer backup, or a sump pump failure, for example) is not covered.
The good news is that depending on your location and your insurance carrier, you may be able to purchase additional coverage to protect yourself in these increasingly common emergencies.
What if I have to Evacuate During a Flood?
Most home, condo, and tenant insurance policies include coverage for additional living expenses, which pays for out-of-pocket expenses like food and accommodations. See our blog on ‘How to Use Additional Living Expenses’ for more information. If you’ve purchased overland water coverage, you may be able to claim your additional living expenses when your local government orders an evacuation due to flooding or if you need to stay away from your home during the repair process after a flood.
What kind of Optional Add-ons are Available?
While optional add-ons vary by insurance company and location, here are two of the more common water-related add-ons to discuss with your broker:
Flood/Overland Water Damage
Insurers refer to ground flooding as overland flooding. If the water touches the ground before entering your home, it’s overland flooding, and most home insurance policies don’t automatically provide coverage. Generally speaking, Overland water coverage protects you from sudden damage caused by excessive rain, overflowing rivers, spring run-off, and melting snow. It usually excludes damage by saltwater, including tidal waves and tsunamis.
Overland flooding is the leading cause of property damage and loss in Saskatchewan. Learn more about this risk from FloodSafe Saskatchewan and how water might impact you.
Sewer and Drain Back-up
Root growth, blockages, or even breaks in the pipes exiting your home can cause backups in kitchens, laundry rooms, or bathrooms. A standard home insurance policy doesn’t provide coverage, but you’ll often be able to purchase coverage as a rider to your policy. Sewer backup coverage protects you from loss or damage to your property caused by the rupture or escape of water from a sewer, drain, sump pump, or septic system. Remember that coverage doesn’t extend to the sewer pipes outside your home.
For exterior underground piping and wiring coverage, including permanent connections, valves or attached devices, ask about Service line coverage. This includes communication lines, internet access, drainage, electrical power, waste disposal, water, and heating, such as natural gas lines.
Tip: Installing a backwater valve can help minimize your risk of a sewer backup.
All home insurance policies are unique, so review your policy and connect with your insurance broker to ensure you have coverage before the next flooding season. An experienced insurance broker can help you assess the risk of flooding in your local area and recommend the most affordable supplemental coverage. If you don’t have Overland water or Sewer backup coverage, ask your insurance broker to give you a quote on the cost to add these valuable coverages to your current policy.