Your Policy Won't Cover That Water Damage


Homeowners insurance can be tricky, convoluted, and have some exemptions you weren't expecting. So often these massive gaps present themselves in the form of water damage. Many insurance agents are not upfront about these limitations. If you do not have an insurance background, some of the gaps in your coverage may cause you a headache down the road and leave you to repair a lot of damage on your dime.

There are some situations where your home policy will cover water damage, depending on the type of contract you have, and what endorsements you have placed on your policy. An HO5, or open peril policy, will typically cover water damage caused by the backup of your sewer drain or sump pump. Both an HO3 (named peril) and an HO5 will cover water damage caused by a leak in the roof or the event of a water pipe burst. Your company will probably even cover a loss if you were negligent, perhaps accidentally leaving the house with a sink running… but there are so many other ways water can damage your home that your policy would exclude.

Regardless of the type of homeowners contract you have, your policy certainly excludes different types of water damage. Not every policy covers the damage to your property if water backs up into your home. No homeowners policies cover the damage from true flooding or rising water. Your insurance company has a lot of reasons why they won't cover these things, for instance, if homeowners insurance policies covered flooding, insurance companies would go bankrupt covering claims from hurricane damage and large storms. For this reason, they simply can't cover your home against these storms, so the Federal Emergency Management Agency (FEMA) steps in.

That is not to say FEMA covers your home if it is destroyed in a hurricane, there are so many people left with nothing after a storm like that. However, FEMA will offer you insurance against these storms, for a price. These policies are written through your existing insurance company, whoever you have your home insured with. However, they are backed by the federal government. The coverages on these policies work a bit differently than your typical homeowner's policy. You cannot get replacement cost for your personal property, and it is unlikely you can get enough coverage to protect you from a total loss, but in the event you need it, it is far better than nothing.

If you live in a floodplain or are in a zone otherwise at risk for flooding, these policies can be astronomically expensive. That being said, your mortgage company may require it for the entire duration of your mortgage. Even if you own your home outright, with the types of storms coming through nowadays, it would be foolish to go a year without it.

On the flip side, if you are not in a high-risk zone for flooding, these policies can be dirt cheap. Away from any waterways and at a higher elevation, you present very little risk and the policy you get should not cost much at all, but of course, you would not likely ever see the benefit from the flood coverage either.

To inquire about flood policies through FEMA, speak to your insurance agent. These policies need to be underwritten by the same company that carries your current homeowner's insurance policy. Quotes are always free and can be done yourself online at You can also find out more information regarding different floodplains and the potential risk for flooding on your home or a home you would like to purchase. Your lender is the only one who can tell you if you will be required to carry this type of insurance policy.

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Kelsey Harris

Associate Writer

Kelsey joined the Wavez staff in June 2019 and has been impressing readers ever since. She graduated from USC with a bachelor's degree in English and specializes in our Health and Finance categories.