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Water Damage ~ if waters leaks through my foundation am I covered?
Most property forms, including the typical Homeowners (HO-3) policy, under SECTION I – PROPERTY EXCLUSIONS, exclude “water damage” caused by:
Water below the surface of the ground, including that which exerts pressure on, or seeps or leaks through a building, wall, bulkhead, sidewalk, driveway, foundation, swimming pool, hot tub or spa, including their filtration and circulation systems, or other structures.
To keep Homeowners policy premiums low and affordable for everyone, coverage is not afforded to losses that can be prevented by sound building practices or as a result of normal wear and tear rather than sudden and accidental events. So, the main reasons it is necessary to exclude “water below the surface” from a Homeowners policy are:
- Current construction methods require the foundation to allow water to drain away from the home. Older homes may not have followed these methods or due to improper grading, the shifting of the soil or past severe water events, water may find a path to begin collecting underground next to the home. If the intrusion of water through foundations were covered by insurance, then a home owner would have no incentive to correct the problem. Covering these events would give rise to repeated claims after every periodic severe weather season.
- Over time, every foundation settles, cracks, and eventually deteriorates. This “wear & tear” may require a home owner to excavate around the foundation (and basement) to place drain tiles and patch/re-seal the foundation and basement concrete walls. Again, if this type of water loss was covered then a home owner would have no financial incentive to repair or improve their home.
For answers to related questions click: WATER DAMAGE ~ Am I Covered?
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- April 14, 2020
Popular Questions
Do standard homeowners insurance policies cover foundation leaks?
When and how does homeowners insurance cover foundation leaks?
How much do I have to pay if homeowners insurance does cover a foundation leak?
If homeowners insurance doesn’t cover a foundation leak, what will?
Expert(s) Found on this Page
Do standard homeowners insurance policies cover foundation leaks?
As a new homeowner, I’m now concerned about all aspects of my home, like what’s covered by insurance and what’s not. I’m nervous about all kinds of things that could potentially go wrong, including cracks in my home’s foundation. Does a standard homeowners insurance policy cover foundation leaks?
It might. This is actually a controversial issue. There are a lot of stipulations that dictate whether a foundation leak will be covered under homeowners insurance. For certain cases, yes, but for others, no. It all really has to do with the root cause of the leak. Once you identify why your foundation is leaking, you’ll be better able to grasp whether or not homeowners insurance will
cover it.
When and how does homeowners insurance cover foundation leaks?
Here’s the deal. There are very specific scenarios in which homeowners insurance will cover foundation leaks, and when they won’t. We’ll take a closer look each side for a better understanding.
Homeowners insurance covers foundation leaks under the following conditions:
- A plumbing leak occurs in the soil around the home, eventually eroding it and causing a crack in the home’s foundation. This crack eventually begins leaking through the foundation into the home. Many homeowners policies will cover this kind of foundation leak because it happens due to water damage.
- A pipe bursts due to freezing, but you had already attempted to prevent this from happening by running the heat. Homeowners insurance usually will provide coverage for foundation leaks that arise due to busted frozen pipes, after a failed attempt on your part to prevent them from freezing in the first place.
- Homeowners insurance will only cover the actual water damage from the foundation leak and whatever it costs to fix that aspect along with the leak itself, but it will generally NOT pay to replace the actual pipe.
Homeowners insurance also won’t provide coverage for foundation leaks that occur because of busted pipes that were installed in clay soil that expands and contracts with changing temperatures. This type of foundation leak is due to what’s known as “earth movement,” which is not a covered peril under homeowners polices.
Other causes may be excluded, as well. It’s important to review your specific policy to find out exactly what’s covered. Your independent insurance agent can go over your policy with you and answer your coverage questions further.
How much do I have to pay if homeowners insurance does cover a foundation leak?
If it’s covered, after paying your deductible, you’ll be responsible for paying any amount exceeding your homeowners insurance policy’s limit in the dwelling’s structure category. These limits are often in the hundred thousands, but you may choose to increase them if you wish. Talk with your independent insurance agent about your concerns to determine if you need more coverage.
If homeowners insurance doesn’t cover a foundation leak, what will?
If your foundation leak occurs due to an uncovered peril under your homeowners insurance policy, you may need an entirely different policy to have coverage. Certain areas where soil expansion and contraction is common, such as Florida, offer a type of insurance called catastrophic ground collapse coverage, which could protect you from foundation leaks in the event of earth movement.
However, there’s unfortunately not an insurance policy that will reimburse you for all aspects of the foundation leak’s repair. There’s generally no insurance policy out there that will cover a broken pipe. You’d have to pay out of pocket to cover that aspect of the expense.
TrustedChoice.com Article | Reviewed by Paul Martin
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