In 2011 48% of home insurance claims were the result of water damage, according to a recent study by the Canadian Institute of Actuaries. That makes it the leading cause of home insurance claims, and a risk that many policies don’t completely cover. To help clarify the risks and coverage options we’ve put together a list of our 8 most common ‘water coverage’ questions and responses below.
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Is Water Damage Covered Under my Basic Policy?
Every home policy insured against basic water damage losses. This coverage can cost anywhere from $20 to $250 per year depending on whether it has specific endorsements, like sewer backup coverage.
Basic water damage coverage included with your home insurance policy covers you for water-related losses such as:
- Your hot water tank suddenly and accidentally leaking;
- Overflow of water from your dishwasher, washing machine, or bathtub;
- Ice damming causing your roof to leak; and
- Water from an above ground pool break entering through your basement windows.
What is Sewer Backup Coverage?
Sewer or Septic Backup coverage protects you against losses occurring due your sewer or septic system backing up into your home. These losses commonly occur during periods of heavy rainfall when the sewer system is no longer able to handle the excess water, and it backs up into your home. Backup water generally emerges from your plumbing and can cause significant damage to your basement or the lower levels of your home.
When the Sewer Backup Endorsement is added to your policy it insures losses such as:
- Sewer backup due to heavy rain;
- Sewer backup due to a clogged line;
- Septic tank backup; and
- Sump pump malfunction causing the pit to overflow.
- Sewer backup does not cover losses created by floods or exterior drains, which requires Overland Water Coverage.
What is Overland Water Coverage?
Overland Water Coverage is a relatively new offering designed to protect against damage caused when water from above ground enters a home though the foundation, basement floors or walls, or through a sewer line. It covers damage caused by fresh water flood such as the overflow of a river, lake, or other body of water. The sudden and accidental accumulation of water due to heavy rainfall is also covered, which is a weather event that Canadians are quickly becoming familiar with.
When Overland Water Coverage is added to your policy it insures losses such as:
- Rain accumulation on the surface and entering through basement windows or a crack in an above grade basement wall;
- Rain accumulation on the surface and entering through the garage door;
- Sewer back up due to heavy rain and surface water also entering the home;
- Sewer backup due to the overflow of a body of fresh water or lake (oceans are not covered!); and
- Accidental dam break.
Not all homes are eligible for Overland Water Coverage. If you live in an area that is considered to be a high-risk flood zone it is not likely to be available. Major risk factors include:
- Driveways that slopes downward toward the house; and
- Dwellings within 100 meters of a river or other flowing body of water.
There is generally a cost to adding Overland Water Coverage to your policy, which can vary widely between different insurers. The cost will depend on the location of your home, the limit of coverage, and the deductible that you choose. The monthly cost could be anywhere from $10 to $30. Your broker is the best person to advise you at to what coverages are available and how to make the coverages as cost effective for your family as possible. You must already carry Sewer Backup coverage to be eligible to add Overland Water Coverage. It is not a stand-alone coverage.
What is Ground Water Coverage?
In additional to Overland Flood Coverage, companies are beginning to also offer Ground Water Coverage, which protects against water damage from underground natural sources such as basement walls, foundations and floors (as long as the loss is sudden and accidental).
Ground Water Coverage can cover losses such as:
- Rain water entering through a crack below grade on a basement wall;
- Rain water enters through the basement floor; and
- Water damage caused by the rising of the water table and septic tank backup.
What is Water and Sewer Line Coverage?
In some cases, Water and Sewer Line Coverage is available to cover losses if you experience a leak, break, tear, rupture, or collapse of a water or sewer line.
What Type of Water Damage is Never Covered?
There are certain water-damage losses that are NEVER covered by your policy. These types of losses can include:
- Long lasting seepage and leakage;
- Rain or snow entering through an open window;
- Roof leaking due to wear and tear; and
- Tsunamis, tidal waves, or other coastal flooding (like we said before, oceans aren’t covered!).
How Do I Know I’m Covered for Water Damage?
- Complete your annual home insurance review with your Excalibur Insurance Account Manager. At Excalibur we have recently begun to reach out to EVERY CLIENT that we service at the time of their renewals to ensure that homeowners are aware of the coverage that they have, and any coverages they may be lacking.
- Read your policy! Boring, we know – but useful nonetheless. If you require a copy of your actual policy wording (the part the generally comes after the fancy first page), please contact the office and we would be happy to send you a copy.
- Tell us if you make changes! Installed a battery backup for your sump pump? Bit the bullet and installed a backwater valve? These changes are important to us, and in some cases have the ability to lower your premiums.
For more information contact us at 1-888-298-7343 or visit our website https://excaliburinsurance.ca/flood-insurance-ontario/
Want to Know More?
Some of our favorite insurers and other governing bodies have put together some great resources on water damage protection. Check out the websites below for more information:
Aviva Insurance: http://avivawaterprotection.ca/
Intact Insurance: https://www.intact.ca/on/en/personal-insurance/home/water-damage-coverage/overland-water.html
Insurance Bureau of Canada: http://www.ibc.ca/qc/disaster/water
Flood Insurance Canada http://floodinsurance.ca
Global News article on the changes to water losses, the problems that have occurred, and preventative measures that people can take to reduce the risk of losses. https://globalnews-ca.cdn.ampproject.org/c/s/globalnews.ca/news/3425571/flood-insurance-canada/amp/