Your homeowners insurance policy will not cover flood damage but may cover water damage depending on the cause of the water. Plumbing leaks caused accidentally, and not due to wear and tear will likely be covered by your homeowners insurance allowing you to stay high and dry. Should the waters rise and enter your home, absent a flood insurance policy, you may be left low and wet.
Next, We will examine two different homeowners, two different flood events, and how insurance policies worked to cover, or not cover each one.
Flood Scenario #1
Sally went to work one day at her usual 9-5 job located about 20 minutes away from her home. Her uneventful day turned quickly when she got home at 5:30 pm. When Sally opened the door a stream of water greeted her at the door. The water was about two inches high ruining her suede boots. As she walked in shock throughout the home trying to locate the source of the leak, she tracked it down to the master bathroom. The hose behind her toilet had given way and was shooting water all over the house, much like an outdoor sprinkler head.
Once the water was successfully shut down, the process of drying out the home began…Step 1. Luckily Sally was insured with a company who provided emergency water mitigation services and a restoration company arrived within hours. The company was able to quickly remove the water from the home by installing machines to begin the drying process. Because the water damage extended throughout the home, the process to completely dry out the home took three days.
Once this was completed, Sally could move on to Step 2, scheduling an inspection of the damage with the insurance company.
When the home was dry, the insurance company adjuster inspected the home to identify the cause of the flood, estimate the damage, and determine if Sally’s policy covered the damage. The final report detailed the damage to Sally’s master bedroom, kitchen, dining room, and living room. The walls, floors, and cabinetry all had to be replaced. The damage was substantial and estimated to cost over $45,000.
Step 3, When construction began, Sally was forced to leave her home, as the water was shut off for several days making the home uninhabitable. The cost of sally’s hotel stay, food, etc., was also covered by her insurance company under Coverage D, additional living expenses.
It took several months before Sally’s life got back to normal, but she was grateful her insurance covered her damage.
Lessons learned from Sally:
- Because Sally’s damage was caused by a sudden and accidental plumbing leak, her homeowners policy covered the damage.
- Checking your water lines behind toilets, washers, and dryers periodically may have prevented this incident.
- Sally’s insurance provided peace of mind by offering access to emergency water mitigation companies.
- Acting quickly to dry and mitigate damage after a flood can save thousands of dollars in additional costs.
(Florida Peninsula Insurance Company offers emergency water mitigation services at no cost to our policyholders when one of our preferred vendors is called. Should you experience water damage call us first.)
Sally’s policy also contained coverage for additional living expenses therefore, Sally was able to vacate the home and allow the repairs to move forward without any additional out-of-pocket expenses.
Flood Scenario #2
Greg enjoys living in his lakefront home where he often relaxes with a warm cup of coffee in the morning, watching the sunrise, before going to work. Greg went to work at his 9-5 job located about 10 minutes from his home. As usual, a typical Florida afternoon rainstorm began at 3:00 pm. Greg’s drive home was terrible, as it was difficult to see in front of him due to the deluge of rain. When Greg entered his development, he found the roads were flooded leading up to his home. Upon entering the home, he quickly realized the lake had overflown. The over-saturated lawn could not handle the additional rain, and the water entered the house through the sliding glass doors located in the family room, and the master bedroom located in the back of the house. Water reached all areas of the first floor. Greg immediately called a water mitigation company who was able to arrive at the home within a few hours;
Step 1. Once the drying process was completed Greg called his homeowners insurance company;
Step 2. His insurance company sent an adjuster to assess the damage. Once the adjuster completed his report; the claim was denied. The adjuster explained the water damage to his home was caused by rising water, the insurance definition of flood. Greg’s homeowners’ insurance policy did not cover flood damage. Greg was very upset and called his insurance agent. The insurance agent explained, Greg had decided to waive the flood policy the agency offered. Because the property was not located in a flood zone, as delineated by FEMA, and the mortgage company did not require this coverage. Greg decided to save the $435/per year this policy would have cost.
Now Greg was forced to move on to Step 3, reconstruction, however, without the financial peace of mind provided by an insurance policy. Greg’s out-of-pocket expenses totaled more than $50,000. Greg was forced to take a line of credit on his home in order to pay for all the repairs needed to get his house to the home it was prior to the flood.
Lessons learned from Greg:
- Rising water is not covered by your homeowners insurance policy.
- A separate flood policy can be purchased for minimal cost.
- Even though the coverage may not be required, 25% of claims occur in non-flood zones.
- It may not be possible to predict rising water or prevent this fast and damaging event from causing thousands of dollars of out-of-pocket expenses. Having a flood policy in place will provide the peace of mind your home will be restored.
It may not be possible to predict rising water or prevent this fast and damaging event from causing thousands of dollars of out-of-pocket expenses. Having a flood policy in place will provide the peace of mind your home will be restored.
Florida Peninsula offers a flood endorsement to qualifying homes. Eligible homes can enjoy the benefit of paying one, all-inclusive, premium which provides both homeowners and flood protection. In the event of a hurricane where damage may have resulted due to multiple causes, wind and rain, the same adjuster will be able to assess all the damage, allowing the claim to be handled more efficiently. If your home does not qualify for an endorsement, the National Flood Insurance Program (NFIP) is available to provide you a separate policy for this important coverage. Ask your agent which flood program is right for you and avoid being left out in the rain.