As the president of a 35-year-old Public Adjustment firm, I often get asked, “Are sump pump failures covered under my homeowners’ insurance?” Well, the answer is maybe!
Let’s start with a basic understanding of water damage and homeowners’ insurance coverage. Except for the basic fire and lightning policy such as the HO-1, most homeowner insurance policies cover water that escapes the home’s plumbing systems such as water heater breaks, broken pipes and toilet overflows. (HO-2, thru HO-5)
What Insurance Companies Define as Flooding
When water hits the ground first and then enters the house, such as melting snow or rain, it is referred to as ground or surface water. Ground and surface water are excluded under all homeowner’s insurance policies. When water enters your home from a municipal sewer line, such as a sewer backup, that, too, is excluded from coverage.
However, just about every insurance company out there lets the policyholder buy back some of that excluded coverage with a “Sewer and Back Up” endorsement or in layman’s terms a “Sump Pump Rider”. Most Insurance companies allow you to “Buy Back” a certain dollar amount of coverage if the water overflows from a sump pump or drain.
(As long as the water doesn’t come from a basement window or through the basement walls)
Insurance Coverage to Consider
If your basement is unfinished and contains few belongings, you may get by with a low $10,000 limit or basic clean-up and drying costs. If your basement is finished and has a lot of furniture, your limits should be more like $50,000 or greater.
It’s understandable if all this information seems overwhelming. That’s why it’s important to communicate your specific needs to your Insurance Agent. If you have any questions about your coverage, don’t hesitate to call our office.
