Does homeowners insurance cover plumbing?
Your homeowners insurance may cover plumbing damage, but some important exclusions often apply. Here's everything you need to know.
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The occasional burst pipe or appliance leak is an inevitability during the lifetime of your home, and most homeowners should expect to have to deal with plumbing issues from time to time. However, the average homeowner's insurance might not cover the resulting damage.
If you're suddenly faced with an expensive plumbing-related crisis , your natural response will likely be to turn to your insurance provider to help you mop up the mess. However, the cause of the damage and the specific circumstances will affect whether or not your insurance policy covers or contributes to fixing it.
Here's what you need to know about homeowners insurance and plumbing coverage.
What plumbing issues does homeowners insurance cover?
A plumber tightens a wrench while fixing a bathroom sink
Different types of homeowners insurance exist, each with variable types of coverage. However, the most common type of home insurance is an HO-3 policy, according to Experian , which provides the following four types of coverage.
Home structure coverage
This type of insurance covers repair or rebuild costs incurred by damage caused by fire, smoke, wind, hail, lightning and certain types of water damage. Note the phrase "certain types of water damage," which is far from all-inclusive and indicates at least some scenarios where coverage is not guaranteed.
Personal possessions coverage
This covers the cost to replace personal items such as furniture, appliances and electronics if they're damaged, destroyed or stolen.
Liability coverage
This insurance type contributes to medical expenses incurred if a person suffers an injury at home, such as falling down a set of wet, slippery stairs. If the person is a visitor, it can also contribute towards the cost of any legal expenses.
Additional living expenses (ALE) coverage
This pays a proportion of any costs involved in living at an alternative location while essential repair work is conducted at your home following a covered loss.
A distinction exists between sudden and accidental damage and water or plumbing damage caused by wear and tear or negligence, according to insurance provider Progressive . In cases of the former, standard homeowner policies are more likely to cover water damage from plumbing issues, whereas water damage from wear and tear (or negligence) is unlikely to be covered.
Generally speaking, most standard homeowners insurance policies do not cover "preventable water damage."
What is 'preventable water damage?'
Water leaks through a suspended ceiling
Consumer financial services company Bankrate explains that homeowners insurance typically covers plumbing damage that occurs suddenly and unintentionally. One example of this would be a burst pipe, assuming it's demonstrably well-maintained.
However, certain categories of plumbing damage fall outside most homeowner insurance policies, including things such as long-term leaks, negligence, old or aging plumbing, sump pump failure and storm surge flooding. Except for storm surge flooding, each of these examples is a form of preventable damage. If a known leak is not properly repaired in a timely fashion, or proper maintenance is not conducted on your pipework, your policy probably won't cover the resultant water damage unless you take out a separate policy to cover for these variables. You can (and should) take steps to mitigate they types of damage by regularly checking the integrity of your appliances and replacing them if necessary.
Consider installing a smart water leak detection system to monitor water flow through your pipelines. Such systems work by cutting off the water flow to the household once an abnormality has been detected, according to South Carolina-based water treatment specialists Fresh Water Systems . Such leak detection systems are usually installed at the water's point of entry to the home, the company says. Once triggered, they cut the water supply to connected fixtures and appliances, protecting the home from costly damage. Many of these systems have smart features that can be accessed via a smartphone app and can send you alerts when irregularities are detected.
By taking these proactive steps, you can prevent some extreme forms of water damage, which could help when submitting a plumbing-related insurance claim.
Average insurance payout figures for plumbing
A person works on a pipe underneath a kitchen sink using a wrench
Even if your homeowners insurance covers plumbing damage, it's usually not as simple as filing a claim and waiting for the payout. The amount you receive will depend on a few factors. Consumer legal site ConsumerShield says that the average payout for water damage claims is between $7,000 and $12,514, and can vary based on the extent of the damage, cost of the repairs and level of insurance coverage.
Home restoration specialists Allied Emergency Services suggest the average insurance payout in the U.S. is approximately $7,000, but stresses that payout amounts can vary depending on the damage and specifics of your policy. For example, the average payout for minor plumbing leaks is between $1,000 and $5,000, and burst pipes and severe water damage carry an average payout of between $5,000 and $15,000, according to Allied Emergency Services' analysis of aggregated industry data.
Of course, any insurance payout for plumbing or water damage requires that you pay your policy's deductible first. That deductible is usually written into your policy when your coverage is arranged. It's wise to make sure you understand any potential limitations of your insurance coverage, including the deductible, when assessing whether or not to make a claim and the potential payout.
If in doubt about plumbing coverage, talk to your insurer
A worried woman calls a plumber while blocking a pipe leak under her sink
Insurers offer optional packages or home emergency add-ons that provide additional cover for plumbing damage that standard policies may omit. Upgrading your existing policy could be worth considering if you'd rather not take any chances. The insurance deductible is applied to the estimated costs of plumbing repairs. If your insurance deductible is higher than the likely cost of repair, it may not be worth your while to submit a claim. Depending on your insurance coverage, you may be covered for the cost of repair to a damaged carpet as a result of a burst pipe, for example, but not for the cost to repair the pipe itself.
Some insurers offer optional packages or home emergency add-ons that provide additional coverage for plumbing damage that standard policies may omit. Upgrading your existing policy could be worth considering if you'd rather not take any chances.
Finally, prepare as much relevant information as possible before you speak to your insurance provider. Take photographs of the damage sustained and, if possible, obtain quotes from qualified plumbin g experts for the repair costs. The more information you can provide, the better equipped your insurance provider will be to advise you on the best course of action.
