In the world of insurance, there always seems to be a catch or clause hidden within the context of any given policy. The water exclusion clause is no exception. Water damage is a contentious issue in most homeowners insurance policies. Especially if you live in an area that frequently receives heavy rains, flooding, or water-related weather events. Generally, the water exclusion clause stands as a restriction on your homeowners or renters policy. The sole purpose is to exclude all claims from damages arising from floods, groundwater, standing water, tsunami or sewage backup from insurance coverage. Of course, as all policies go, the water exclusion clause can also be quite nuanced. Let’s take a deeper look.
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What Exactly Is A Water Exclusion Clause?
As mentioned briefly above, the water exclusion clause in a homeowners policy holds as a restriction that allows insurers to deny coverage for most water-related claims. While not every water-related event falls under the water exclusion clause, it isn’t uncommon for flood damage, groundwater damage, tsunamis, standing water, or drain backups to be included in the clause itself. In order to protect themselves in the event of water damage, you may want to hold specific water damage coverage or purchase a separate insurance policy.
Of course, you may be asking, why so many water-related incidents are even excluded in the first place. After all, you can’t control or predict when a tsunami might hit. The rationale that continues behind a water exclusion clause is that floodwaters, tidal waves, shocks, and tsunamis are natural devastations. These disasters only disturb persons residing in neighborhoods that are already susceptible to such perils (ie: living along the beach or near a flood plain). Because of this risk, insurance companies executed the clause as a way to safeguard themselves in these ostensibly high-risk regions.
Does The Water Exclusion Clause Include Every Type Of Water Damage?
Water-related incidents are common whether you live near the coastline or not. In fact, even rural areas of Pennsylvania have been known to suffer from damages due to hurricanes off of the New Jersey coast. Sometimes, the location has nothing to do with risk. Luckily, not every aquatic peril is excluded by your homeowners insurance policy. In fact, most policies will cover water damage that is caused by a specific reason. Let’s say your dishwasher malfunctions or you suffer from a plumbing issue. Most likely, insurance will cover the cost of any damages. What insurance won’t cover is the cost that can come from the gradual wear and tear on a home or plumbing system.
Additionally, homeowners insurance often covers damage that occurs due to a specific weather event. For example, if you live in the Midwest and a heavy snowfall collapses your roof, allowing water to pour in, the water damage will likely be covered. The same goes for thunderstorms or tornadoes. Hurricane-related damage is also covered in all but 19 coastal states. In most coastal states, policyholders are required to pay an added hurricane deductible before coverage will actually hold.
Will My Homeowners Insurance Cover Flood Damage?
One thing that most policyholders will never understand is why flood damage is rarely covered by homeowners policies. Thanks to the water exclusion clause, flooding is almost never covered. In fact, unless flooding is due to an internal cause, like an overflowing toilet, you will have to cover the cost of any damages on your own.
Within an insurance policy, a flood is defined as water that rises and enters from the outside in. That means any surface water that enters your home from the outside can legally be excluded. This is a sore spot that is subject to plenty of controversies, given that flooding can come from man-made forcers such as a collapsed levy or a burst dam. Man-made floodwaters have nothing to do with location or risk, thus many feel as if those instances should legally have to be covered.