Who doesn’t enjoy a swim on a hot summer day? Swimming is a refreshing way to cool down and relax. And with an iced drink in hand, floating in the pool is an amazing way to destress – unless you snap back to reality, realizing you don’t actually have a swimming pool, and are in the middle of a small pond in your basement.
The first question you probably have is: where the heck did all of this water come from? And the next: will my homeowners insurance cover this?
Is it Flooding or Water Damage?
When we walk down the stairs into our basement and find it actively filling with water, we immediately go into overdrive and try to remove the water by any means necessary. We look a lot like the Disney character Mickey Mouse trying to stop those magically animated brooms from dumping more water into an already overflowing space. We are so concerned with getting the water out, that we’re not paying attention to where it’s coming from.
Is this new “swimming pool” in your basement the result of a burst pipe, or is it because of the rising creek not far from your property? The reason behind the flooding will make a big difference to your insurance company.
Flooding and water damage are considered to be two different housing disasters in the insurance industry. Flooding is characterized by an external water source rising on your property, such as brought on by a hurricane, mudslide, tsunami or other natural disaster.
Water damage is characterized by an internal water source in the home that has not touched the ground outside. Examples of water damage include a burst pipe, leaky roof or faulty drainage system. Water damage is covered under your homeowners insurance policy, flood damage is not.
Insuring a Home for Water Damage
The non-profit Insurance Information Institute (III) reports that between the years 2010-2014, (the current available data) water damage and freezing claims came to a financial average of almost $8,000. That’s a lot of money for a moisture problem in the house. Even if you think your home is safe from such a watery catastrophe, it’s still smart to take out protection.
Let’s say the home inspector you hired to take a look at your house gave you top marks and assured you that your house is well-guarded against water damage and other housing disasters. Does this mean you should just forego homeowners insurance? The answer is no. Even if you take every precaution to ensure that your pipes won’t freeze during winter and that your electrical wiring won’t short and cause an electrical fire, things can still happen.
The standard homeowners insurance package will provide coverage for/in the following areas:
The structure of the home
You will have noticed that flood damage is not included in the above list. This is because homeowners insurance does not cover flood damage. To get flood damage protection, you will need to take out a separate policy. In states that experience heavy rainfall and severe hurricanes, you will be required to have a hurricane deductible, protecting you, your house and your finances.
To make sure that you are getting the right amount of insurance coverage for your home, sites like CoverHound help customers compare homeowners insurance premium rates and package offerings in just a few minutes. Let’s face it, looking for insurance is one of those frustrating and annoying occurrences in life that no one really wants to have to deal with. Comparison websites make looking for insurance a little easier, a little less stressful and way more affordable.