Understanding which losses are covered and which are not will help you take the necessary precautions to avoid uninsured water losses. The damage from water can be devastating, expensive and always unexpected!
The typical Homeowners policy (HO-3, Special Form) covers all risks of direct physical loss to your home including water damage but with significant exclusions and limitations. Generally speaking, your Homeowners policy will pay for sudden and accidental water damage from inside water sources but does not pay for losses caused by water that finds its way into your home from the outside. Where the water originated ultimately determines whether a loss may be covered or not.
So, unless excluded or otherwise limited, water damage is a covered loss when caused after an inside water pipe leaks or breaks (like behind a wall or under a sink); or leaks from appliances (like hot water tanks, washing machines, or dishwashers). Your property deductible is deducted from the covered loss.
LOSS SETTLEMENT: It is important to note that it is the “damage” to your home from the water loss that is covered; NOT the repair to the actual item that failed. Your Homeowners policy pays for the necessary costs to access (eg. cut open an undamaged wall to access a broken pipe and then pay to repair the wall) and repair the damage caused by the water. But, the broken pipe itself, which failed because of wear and tear, decay, defective materials or methods of construction is not part of the covered loss. The cost to repair the pipe or appliance is your responsibility.
The content of FAQ articles are general in nature and are not intended as a substitute for professional legal, financial, or insurance counsel for individuals. Insurance coverage forms vary by issuing company and by state. For specific advice contact us.
American Insurance NW Inc. is an independent insurance agency with offices in Lewiston and Moscow, Idaho.