Whether you own a residential or commercial property, it is crucial that you properly insure this significant investment to protect yourself and your belongings, and It is just as important to be fully aware of what your coverage entails.
When purchasing property insurance, the first step is to read the policy in its entirety, especially when it comes to the topic of water damage. Insurance claims for water damage can take many different forms, and if your specific issue is not covered, you will be responsible for all costs associated with repair and replacement of your damaged items.
Determining the root cause of water damage, reviewing whether your policy covers the damage, as well as understanding any limits that may exist on that coverage can be a challenge. Here, we break it down for you so you can understand your policy.
Types of Water Damage Covered Under Most Policies
Water damage is often not covered by insurance policies, or the coverage you do have may not fully address the damage you may encounter. For instance, internal water damage caused by broken pipes or water heaters, such as damaged walls or flooring, is frequently covered. However, your property might not be covered by your insurance policy if the water damage was caused by inadequate upkeep or a flood.
The two common types of insurance coverage are dwelling coverage and personal property coverage. While personal property coverage will cover you for damaged to your belongings like furniture etc., dwelling coverage assists in covering the damage to the interior of your property like walls and flooring.
Is Water Damage Coverage Limited By Insurance?
When a catastrophe happens, many people believe that the full cost of water damage will be covered by their insurance. All too often, once the insurance company’s field adjuster visits your property to evaluate the damage, the insurance company informs you that your policy has a limit. For example, you may be told your policy is limited to $10,000 but the overall damages will cost several thousands of dollars or higher.
In fact, some insurers are now starting to completely eliminate water damage coverage for buildings older than 40 years. However, you may be given the choice to pay an extra premium to have limited water damage coverage included in your policy.
Some insurance companies have also refused to provide water damage coverage if the plumbing is older or original to the property. In those cases, they have requested the plumbing be changed and upgraded in order to provide water damage coverage. So, if you have cast iron plumbing, they may request you change the plumbing system to PVC pipes.
Erosion of Coverage
When you buy residential or commercial property insurance coverage, you expect to be covered when and if you need to file an insurance claim. However, is possible that when you do need to file a claim, you are then shocked to find out that you are not fully covered.
We refer to this as the insurance industry's constant erosion of coverage. Insurance companies are either placing limits on coverage or excluding coverage all together. For example, there are some policies with coverage limitations for leaks of any kind that go on for a period of 14 days or more, whether hidden or not. Some insurance companies have added language to their policies that says that the damage caused in the days preceding the 14 days will not be covered if this limit applies.
We Are Here to Help You
Understanding what you are and are not covered for is crucial. At Reliant Insurance Adjusters, we provide free insurance policy reviews and coverage recommendations to help ensure you have the necessary property coverage.
If you need assistance filing a water damage claim or any other property damage claim, we are ready to help! Call us today at to (561) 288-6434 or contact us here get started.