Understanding Water Damage Coverage: A Policyholders Guide

Water damage is one of the most common and potentially devastating issues property owners face. Whether it’s due to a burst pipe, heavy rainfall, or a faulty appliance, water damage can wreak havoc on your property. Understanding your insurance coverage is crucial in such situations. We will delve into the intricate details of water damage coverage, so that you, as a policyholder can be better informed and prepared in the event of water damage.

Types of Water Damage Coverage

Sudden and Accidental Damage

Most standard property insurance policies cover sudden and accidental water damage. This includes situations like a burst pipe, a malfunctioning appliance, or a sudden leak in the roof. However, coverage might vary based on the specific cause, so it’s essential to understand the policy terms.

Flood Damage

It’s important to note the standard insurance policy typically does not cover flood damage. For protection against floods, a separate flood insurance policy from the National Flood Insurance Program (NFIP) is necessary. Furthermore, if you live in a flood-prone area, investing in flood insurance is highly recommended.

Sewer Backup

Sewer backups can cause significant damage to your property. Some insurance policies offer coverage for sewer backups, but it’s often an optional add-on. Check your policy to see if this coverage is included or consider adding it for comprehensive protection.

Understanding Coverage Limits

Even if your policy covers water damage, there are often limitations to the coverage. These limitations may include caps on the total payout, restrictions on certain types of water damage, or higher deductibles for specific causes. It’s crucial to review your policy documents carefully to understand these limitations and assess if additional coverage or policy adjustments are necessary to align with your financial situation & strategy.

Preventing Water Damage

Regular Maintenance

Regularly inspect and maintain your property, checking for signs of leaks, deteriorating pipes, or faulty appliances. Consequently, addressing issues promptly can prevent significant water damage.

Install Proper Drainage Systems

Ensure your property has adequate drainage systems, including gutters, downspouts, and sump pumps. Therefore, proper drainage can redirect water away from your property, reducing the risk of water infiltration.

Educate Tenants

If you rent your property, educate tenants about the importance of reporting leaks promptly. Simultaneously, in your own residence, ensure family members are aware of water-saving practices and how to shut off the main water supply in emergencies.

Being well-informed about your water damage coverage is the first step in protecting your property and assets. Regular policy reviews, understanding coverage limitations, and investing in additional coverage where necessary can provide peace of mind. By taking preventive measures and staying informed, policyholders can minimize the risks associated with water damage and ensure a swift and effective response in case of emergencies. Remember, a well informed individual can better protect their property. Stay informed, stay vigilant, and safeguard your property against the unexpected challenges of water damage.


Mitigation After a Hurricane

The destruction after a hurricane can be immense and overwhelming. And despite the aftermath of a hurricane, the last thing you want is for your property to suffer more damage. Your insurance policy will also mandate for you to mitigate further damages. We’ll discuss your duty as a policyholder to mitigate further damages, options for mitigation, and how mitigation factors into your insurance claim. 

Policyholder Responsibilities to Mitigate Further Damages

In your insurance policy, there will be language that requires a policyholder to properly mitigate their property from further damages following a loss. In other words, a policyholder is responsible for protecting their property in the interim until repairs can be completed. The language will vary in each policy, but the overall objective is the same: Protect property from further damage.

Within your policy, you can find the language for mitigation in the “Duties After Loss or Damage” section. Below are two examples of policy language.

More in-depth language example:

(4) Take all the reasonable steps to protect the Covered Property from further damage, and keep a record of your expenses necessary to protect the Covered Property, for consideration in the settlement of the claim. This will not increase the Limit of Insurance. However, we will not pay for any subsequent loss or damage resulting from a cause of loss that is not a Covered Cause of Loss. Also, if feasible, set the damage property aside and in the best possible order for examination.

More simple language example:

(b) Protect the property from further damage. If necessary for property protection, make reasonable repairs and keep a record of all repair costs;

Storm damaged house with protective tarp

Options for Mitigating Against Further Damage

We recommend after a hurricane to seek the advice and assistance of a professional where the damages can be quite extensive and overwhelming. A professional will inspect your damages, provide an estimate and perform the mitigation for you. In severe damage cases, a speciality mitigation company may be required to tend to more complex mitigation requirements.

Common mitigation applications often include:

    • Tarping roofs to avoid leaks or intrusion of other debris
    • Securing damaged areas where leaks could occur
    • Covering broken windows or compromised opening
    • Removing surrounding debris.

As a requirement per your insurance policy, mitigation can be costly. However, you do not want to skimp on mitigation. By barely or not protecting against further damage, you are at risk of the spread of mold or mildew, and additional structural damage that your insurance carrier may not cover. We advise having your insurance policy review prior to a hurricane so you are informed on the level of mitigation you are required to complete. You can have a free policy reviewed by our legal experts here!

How Mitigation Factors into Your Insurance Claim

Per your insurance policy, your insurance carrier expects you to take all reasonable measures to protect your damaged property from further damages. In most cases, mitigation costs are recoverable under your policy.

However, utilizing expensive techniques, such as shrink wrapping that is a temporary secure tarp for the roof, can be more difficult to recover the costs from the insurance carrier. During a hurricane disaster, suitable alternatives, supplies, and mitigation companies could be sparse for an extended period of time. In these incidents, it’s critical to communicate with your insurance carrier in these situations to ensure you’re not paying out of pocket for mitigation.

Failure to mitigate can jeopardize your claim settlement by reducing the final settlement or a claim denial. Just as documenting your property prior to the storm and immediately following is important, documentation during mitigation is just as important. During mitigation, we advise:

  • Taking photos from various angles of all steps taken for mitigation
  • Taking videos where necessary
  • Maintain copies of communication with vendors, receipts and materials

Acting fast following a hurricane to mitigate from further damage is essential. During your preparation for the hurricane, we recommend having a list of mitigation companies that you can quickly deploy to your property to inspect following the storm. Mitigating your property following the storm will mitigate you from a claim denial from your insurance carrier.