Does home insurance cover water damage?

Mon Jun 17 2024

A home's front door surrounded by water and sandbags

Homeowners insurance does cover some types of water damage, but a standard policy does not cover flood damage. That’s important to know wherever you live, but it may be especially so if you’re in an area that is hurricane prone.

The official start of hurricane season in the Atlantic starts on June 1, so mark your calendars! – but it’s never too early to prepare. Asking questions about how your homeowners insurance handles water damage can help you ensure you’ve got the appropriate coverage in place.

Here’s an overview of what your homeowners policy covers – and what it doesn’t – when it comes to floods and water damage.

What’s covered: Water damage that starts inside your house

Generally speaking, if you have a homeowners policy written on n HO3 form, or if you have a House & Property policy,  your insurance offers coverage for two types of water damage:

  • Water damage that originates inside your home and is caused by a covered peril. Pipes and appliances that suddenly burst or start leaking are the two biggest culprits of this type of damage. They can wreak serious havoc, often damaging entire sections of a house, and replacements can be expensive.

  • Water damage that results from covered property damage. HO3 and House & Property policies cover damage from “fallen objects,” so if a tree branch collapses your ceiling during a rainstorm your homeowners insurance can usually cover for the water damage, because it was enabled by the covered fallen tree branch. (Ditto for water that gets in because of other types of covered events.)

There’s a big caveat here, though: this coverage exists, as we mentioned, if you have House & Property insurance or an HO3 policy. If you’ve got coverage on form HO1 (also called a “named perils” policy) or HO2, you may not enjoy these same protections.

If you have either an HO2 or HO1, then you may want to get a quote from us.  

What coverages apply? 

Assuming your homeowners policy protects against external water damage, then you likely have two specific coverage parts that apply:

  • Coverage A. Also called dwelling coverage, Coverage A helps pay for repairs to the structure of your home when it’s damaged by a covered peril. For example, water damage to your floor may trigger your dwelling coverage if it was caused by a pipe burst.

  • Coverage C. This is also known as personal property insurance because it covers your belongings. So if that same pipe burst ended up destroying your computer, Coverage C typically kicks in to protect against the loss.

These two coverage parts are the most likely to apply to water damage, but others can be involved depending on the circumstances.  

What’s not covered: Water damage that starts outside

Nearly all standard homeowners insurance policies exclude coverage for floods, which insurance companies consider to be water damage that starts outside your home.

If this is a surprise to you, you’re not alone: one study found that 56% of homeowners mistakenly believe that their homeowners policy offers flood protection.

So what does an insurance company consider a “flood?” Any of the following:

  • Rising waters, whether from unusual rainfall or because of backed up storm drains in your area.

  • Rising mud from similar causes.

  • Water that flows into your home because of a malfunctioning municipal sewage system.

Homeowners who have a risk of flood damage may want to look into getting flood insurance. And who has flood risk? Just about everyone.

Flood coverage isn’t just for homeowners in designated floodplains. More than 25% of flood claims come from homeowners who live in low-to-moderate flood zones.

The reasons for this are complex, but one cause could be climate change. As serious storms increase in frequency and severity, flooding may be the new normal for more and more Americans, whether because they’re in a low-lying area or because the local storm drains aren’t able to keep up with the rainfall and debris.

At Kin, we don’t offer flood insurance everywhere. However, if you live in Florida or Louisiana and buy a home insurance policy from us, you can add a flood endorsement.

Other types of water damage that aren’t covered

We like to make a point that floods aren’t covered by home insurance because of the amount of damage they can cause. However, other types of water damage are also typically excluded, such as those caused by: 

  • Poor maintenance and neglect.

  • A damaged water main.

  • An earthquake.

  • An outside sewer or drain. (You may be able to get an endorsement for water backup and sump pump overflow.)

A special note on flood insurance for homeowners

One final consideration regarding homeowners insurance in Florida and other coastal states: While hurricane wind damage is covered by standard homeowners policies, it may be subject to a special hurricane deductible. In other words, if you file a claim on your home insurance, you may be responsible for paying more than your standard deductible toward repairing that damage before you’re eligible to collect funds from your insurer.

That’s one way insurance companies manage their risk during times of high claim frequency.

The bottom line

If you have only standard homeowners insurance, you’re probably not covered for flood damage. If you’d like flood insurance, your Kin representative can help you secure coverage. Contact us for more information.

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