What Is Water Damage Insurance?

Water damage insurance is a type of protection provided in most homeowners insurance policies against sudden and accidental water damage. Water damage insurance does not cover damage resulting from the homeowners' negligence or failure to maintain the home in good repair. Moreover, flooding usually requires a separate policy if available.

Understanding Water Damage Insurance

As water damage insurance does not cover negligence, many types of water damage to real property can and should be avoided through proper maintenance. This can be anything like watching out for drippage from the ceiling during a rainstorm or fixing a leaky pipe under the kitchen sink before mold becomes prevalent.

Water damage is a major factor in homeowners insurance claims. According to the Insurance Information Institute, water was the third-leading cause of claims from 2014-2018 with an average of $10,949 per claim. Water damage and freezing was the second most-frequent claim after wind and hail damage. About one in 50 insured homes has a property damage claim caused by water damage or freezing each year. It's five times more likely your home will be damaged by water than you'll have a claim for theft, and water damage is seven times more prevalent than fire.

Types of Water Damage Claims

There are two common types of plumbing supply system failures: frozen pipes, which can burst due to a buildup in water pressure caused by freezing water in an adjacent section of the pipe, and when the supply system material fails and results in a leaking or bursting pipe.

Plumbing supply system failures are the top reason for water damage claims, with 48% greater losses in dollar terms, averaging $5,092 per incident after the deductible. Of these, 65% were caused by a failure of the plumbing supply system material, while 18% were caused by frozen pipes. Drain system failures are another top source of claims with $4,400 per incident paid in claims. Sewer backups in finished basements were a top source of claims as well.

Toilet failures were the second-leading cause of water damage, either from the water supply line or from the toilet backing up into the house, followed by water heaters failing and causing water to enter the home. Washing machine supply lines were another top cause of damage.

Special Considerations

To mitigate water damage, have older homes inspected by a licensed plumber every five years, replace older water heaters, use steel-braided supply lines on washing machines, and turn off the supply lines when the machine is not in use. Don't run the dishwasher or washing machine when someone's not at home.