Does Home Insurance Cover Water Leaks?

You do not wish to encounter water damage in your home, but many people have to deal with the overwhelming and frustrating situation at some point in their lives. Coverage for water leaks can have a lot of ambiguity, so we’ve broken down the key components to know about your home insurance options and water leaks.   

Types of Home Insurance Policies

In Canada, homeowners can choose several home insurance policies that protect their homes and belongings. In addition to the basics of coverages, there are additional coverages you can choose from to cater to your specific needs.  

You could choose a comprehensive policy with the most all-encompassing coverage for things like burst pipes, plumbing incidents, and appliance overflows. However, it is essential to note that even a comprehensive plan will not cover any damage caused by natural disasters like floods. 

Alternatively, you could opt for a Named Perils Policy. This coverage is for those who either do not qualify for comprehensive coverage, or have extreme financial constraints. While this option is more cost-effective, the comprehensive option offers you much more protection.  

Understanding Water Coverage

Understanding the water coverage insurance options available is the easiest way to protect yourself from an unwelcome headache, but it can be difficult to dicifer without expert advice. Your broker is here to help! Different insurers offer different insurance packages; within those packages, there can be several inclusions and exclusions. As always, you can work with your broker to determine precisely what your home needs and gain understanding of your specific coverage.   

An essential aspect of choosing the right Water Coverages for you is to evaluate your:  

1. Coverage limits, or how much your insurer & their competitors will cover. (You may receive better coverage depending on the insurance company) 
2. Deductibles, or what you will need to pay out of your pocket before your insurance kicks in. 
3. Inclusions and exclusions, what your policy does and doesn’t cover. 
4. Conditions – what you’re required to do to maintain coverage – example, having someone come check on your home while you’re away for an extended period. 

Common Home Insurance Water Damage Coverage

It is essential to know what water damage scenarios are covered by your home insurance. Typically, home insurance covers instances of sudden and accidental damage. However, the coverage is dependent on the cause.  

You should always check your home insurance policy to confirm, but the most common scenarios that are covered are:  

1. Burst pipes due to freezing or corrosion  
2. Sudden appliance leaks, such as a washing machine   
3. Accidental overflow from a sink, bathtub, or toilet due to a malfunction  
4. Water heater failure resulting in water damage  

A few incidents that are likely not to be covered by your primary home insurance are:  

1. Gradual leaks If they are not sudden or accidental, they might not be covered.  
2. Seepage – Ground water slowly penetrating through a porous material or small hole. 
3. Damage from wear and tear, aging, or lack of maintenance.  
4. If the leak is a known issue caused by negligence and not repaired.   
5. As mentioned above, standard home insurance policies don’t typically cover flood damage, however it is reccomended you add this coverage.  
6. Freezing pipes when youre away from your dwelling, unless reasonable steps (outlined by the insurance company) were followed.  

Accidental Water Damage Coverage

Comprehensive insurance provides a robust shield against several risks. These risks include sudden or accidental water damage, including burst pipes, malfunctioning appliances, or accidental water damage.  

Unfortunately, accidental water damage can sometimes happen at the most inconvenient times, like the middle of the night, while you are out of the house or out of town. If you are ever leaving town for an extended period, it is recommended that you have someone check in on your house frequently to ensure no sudden water damage has happened to your home. 

Slow Leaks and Maintenance

If unaddressed, slow leaks can lead to significant water damage, so knowing how to prevent them around your home is essential.   

There are a large number of areas in your home that slow leaks can come from, and we’ve outlined the most common ones below and how to spot them:  

Plumbing fixtures  

• Check under sinks and around faucets for signs of discolouration, water accumulation, or mould.  
• Run water in sinks and showers to see if there are any leaks or drips when the water is turned off.
• Install an automatic or monitored backwater valve – The backwater valve is designed to automatically shut to prevent leakage out of the plumbing fixture if sewage from an obstructed public sewer backs up the owner’s drain line. 

Toilets  

• Listen for constant running water.
• Check around the base of the toilet for discolouration or dampness. 

Water Supply Lines for Appliances  

• Look for signs of water around connections for washing machines, dishwashers, and refrigerators.
• Upgrade from plastic to metal braided hoses.

Pipes

• Inspect pipes for visible signs of moisture or rust.
• Monitor water meter readings when water is not in use to detect hidden leaks.
• Listen for hissing or dripping noises that could indicate a leak.

Roof  

• Examine the ceiling for discoloration or signs of water damage.
• If you have an attic, inspect it for mould or dampness after heavy rains.

Windows and Doors  

• Inspect the seals for visible gaps, damage, or mould.
• Check for warped or damaged wood around door frames and windows.

Gutters and Downspouts  

• Clean gutters regularly to prevent clogs.
• Check for proper water flow through downspouts and away from the foundation.

Overland Water (Flood Damage) Coverage 

Canada has experienced an increase of flooding due to climate change. Previously, there was very little coverage for flooding, leaving homeowners exposed to financial implications caused by floods. However, there has been a shift in coverage in the insurance sector.   

Overland Water (flood protection) has been introduced as a specialized coverage as it is now accessible to most homeowners. Overland Water covers damages from overflowing rivers, lakes, or intense rainfalls that penetrate the ground and enter homes.   

Seepage and Home Insurance

Seepage is the slow escape of a liquid through a porous material or small hole. Unfortunately, This can be caused by foundation cracks or compromised waterproofing, a common exclusion in home insurance policies. Seepage is seen to be preventable through routine maintenance, so it’s essential to continue to address any visible signs of leaks promptly.  

Two Types of Coverage for More Comprehensive Protection

You may wonder how to ensure your home is covered for as much potential water damage as possible. Consider additional overland water, ground water and sewer backup coverage to provide multi-layered protection.  

As mentioned, overland flood protection shields homeowners from water entering their homes from lakes, rivers, or intense rainfall. With the unpredictable amount of rain nationwide, many homeowners purchase this coverage. Often, sewer backup coverage is combined with this coverage, protecting your home against the overflow of sewers into the house.  

Ground water coverage – An optional coverage for homeowner policies, available for purchase. It offers protection for events when ground water enters your home suddenly and accidentally through basement walls, foundations or floors. 

The cost of adding sewer backup insurance to your home is relatively low, especially considering how much it can protect you if your house is flooded by heavy rainfall or rising lake or river heights.   

Water Damage Insurance Terminology

We get it, there are a ton of different terms used in this article, so we’ve created a quick list of the most common key terms relating to water damage: 

• Accidental – Events or actions that happen unexpectedly, without intention or premeditation.   
• Exclusion – Conditions that are explicitly not covered by the insurance policy.  
• Premium – The insurance policy cost, typically paid monthly or yearly.  
• Seepage – The slow gradual movement of a liquid through a porous material or small hole.  
• Sewer system – A network of pipes and infrastructure designed to carry and remove wastewater and sewage from structures.  
• Sudden – Actions that occur quickly.  
• Water escape – Unintentional release of water from a source leading to potential damage.  
• Water mains – Large pipes that form a part of a public eater supply system that transports water from a treatment plant to various locations.  
• Ground Water – Water located beneath the earth’s surface in soil or porous rock.   
• Overland Water – Water that accumulates on the surface of the ground and is not confined to a body of water, like a river or lake.   
• Sewer Backup – When wastewater or sewage flows backward into a home or property through plumbing fixtures or drains.  
• Backwater Valve – A plumbing device installed in a property’s sewer line to prevent the reverse flow of sewage into the building during heavy rainfall or flooding.  
• Condition – Conditions are provisions in the policy that qualify or limit the insurer’s promise to pay or perform. The insurer can deny the claim if the policy conditions are unmet.   

At Park Insurance, our brokers are here to guide you through your home insurance coverage every step of the way. Get in touch with one of our brokers today to learn more about the proper coverage for your home.