Imagine this scenario: You’re a homeowner whose house is hit hard during a storm. Rain soaks through your roof and damages your walls and floors, and to make matters worse, you return home to find that water accumulated outside the building creating a flood inside. It’s a grim situation to be in, but let’s assume you at least have flood insurance that is supposed to cover the damage. After the storm, a claims adjuster comes out, looks at your house, and tells you that your flood insurance won’t actually cover the destruction because there was water damage before the flood.
Many homeowners and business owners don’t realize that flood insurance and water damage insurance are two different things. Your claim won’t be covered if your particular type of insurance doesn’t cover your property damage. That is why it’s important to understand the differences between water and flood damage. These two things are usually used interchangeably. When it comes to insurance companies and repair coverage, they are quite different.
Floods
The National Flood Insurance Program defines flood as: A general and temporary condition of partial or complete inundation of two or more acres of normally dry land area or of two or more properties (at least one of which is the policyholder’s property) from:
Overflow of inland or tidal waters;
Unusual and rapid accumulation or runoff of surface waters from any source;
Mudflow; or
Collapse or subsidence of land along the shore of a lake or similar body of water as a result of erosion or undermining caused by waves or currents of water exceeding anticipated cyclical levels that result in a flood as defined above.
Water Damage
Unlike a flood, water damage is typically covered under homeowners insurance, but you should read your policy carefully to determine exactly what kind of water damage the insurer will cover. In general, water damage differs from flood damage in that it occurs before water comes in contact with the ground. For example:
Severe rainstorms soak through your roof, damaging walls and floors.
An upstairs pipe bursts and water saturates the ceiling below.
A toilet overflows soaking your bathroom floorboards.
A hailstorm breaks your windows and allows water into your home.
Water Damage & Homeowners Insurance
Your homeowner’s policy routinely covers water damage. In fact, it’s one of the primary reasons people have insurance in the first place. The truth is, almost everyone will experience water damage at some point in their life. Depending on the severity of the damage and how long it takes to discover and control the water source, the situation may be minor.
It’s always best to leave the decision up to the professionals who routinely assess this type of damage. Not fixing water damage quickly can result in additional damage to the home. Leaving carpeting, flooring, or walls wet can cause mold growth, which can be harmful when inhaled. Even if it looks like water damage is negligible, there may be water or moisture in your behind walls or under floors. When water damage occurs, it’s vital to have a professional assess the situation using moisture meters and professional equipment.
Flood Damage Insurance
Flood damage and insurance are a bit more complex. Depending on the home location and your insurer, it may be possible to add a rider to your existing homeowner’s policy to cover flood damage. In this case, the homeowner needs to pay attention to any clauses or exclusions in the policy.
The most important thing you can do is to carefully review your insurance policies so that you know precisely what will and will not be covered, preferably before your home or office is damaged by a flood and other types of water damage. Another important thing is, don’t wait to purchase flood insurance until the weather forecaster predicts historic rainfall or possible flooding—most flood insurance policies require a 30-day wait period before the policy takes effect.
Talk to ONYX Insurance Brokers to make sure you are clear about the coverage details of all of your personal and business insurance policies and to help you make the right insurance choices. Contact or email us now.
