Water, water everywhere, but not a drop should be there. With dismay, you discover that your home is filled with damaging water. Will your insurance policy cover this loss? That depends on the type of insurance you chose to purchase and how the water entered your house.
There basically are two insurance policies that deal with a homeowner's damage due to water -- a flood insurance policy and a homeowners insurance policy. Losses not covered by one of these policies may be covered by the other. Knowing the losses to which your home could be exposed will help you decide whether to buy one or both of these insurance coverage.
While insurance policies may differ in the coverage provided from homeowner to homeowner, there often are basic features common to all policies. You should ask your insurance agent or insurance company about the specifics of your insurance policy. In the meantime, the Insurance Information Network of California (IINC) offers the following general information based on standard insurance policies.
As the name implies, a standard flood insurance policy, which is written by the National Flood Insurance Program, provides coverage up to the policy limit for damage caused by flood. The dictionary defines "flood" as a rising and overflowing of a body of water onto normally dry land. For insurance purposes, the word "rising" in this definition is the key to distinguishing flood damage from water damage. Generally, damage caused by water that has been on the ground at some point before damaging your home is considered to be flood damage. A handful of examples of flood damage include:
A nearby river overflows its banks and washes into your home.
A heavy rain seeps into your basement because the soil can't absorb the water quickly enough
A heavy rain or flash flood causes the hill behind your house to collapse into a mud slide that oozes into your home.
Flood damage to your home can be insured only with a flood insurance policy -- no other insurance will cover flood damage. Flood insurance is available through your insurance agent, insurance company or local Federal Emergency Management Office (FEMA). To determine if your home is located in a flood plain, contact your county planning office. If you are living in a flood plain, flood insurance may be an excellent purchase.
A homeowners insurance policy doesn't provide coverage for flood damage, but it does provide coverage for many types of water damage to your home. Just the opposite from flood damage, for insurance purposes, water damage is considered to occur when water damages your home before the water comes in contact with the ground. A few examples of water damage include:
A hailstorm smashes your window, permitting hail and rain free access into your home.
A heavy rain soaks through the roof, allowing water to drip through your attic or ceiling.
A broken water pipe spews water into your home.
Even if flood or water damage is not covered by your homeowners insurance policy, losses from theft, fire or explosion resulting from water damage is covered. For example, if a nearby creek overflows and floods your home, and looters steal some of your furnishings after you evacuate, the theft would be covered by your homeowners insurance because it is a direct result of the water damage. However, the flood damage would be covered only if you have flood insurance.
It's important to note that flood insurance and homeowners insurance do not duplicate coverage for water damage. Instead, they complement each other.
It is up to you to talk to your insurance agent or insurance company about flood insurance and homeowners insurance, and then decide which insurance coverage you need to protect your home, its contents and your family.