At Huggins Dreckman and DRIVE RIGHT Insurance, we use Safeco Insurance a lot for homeowners’ protection; as well, we use great companies such as Mercury Insurance, Oregon Mutual, ASI, Kemper, Arrowhead/Universal North America, and others. So, we look to Safeco for coverage analysis quite a bit.
All of these companies provide comprehensive homeowners insurance products. But there is a coverage that is often not included in the policy, but it can help you to protect yourself from the potentially disastrous effects of water backup damage.
Safeco has provided an overview of their form below. While it is their specific coverage form, as they say “it’s close enough for horse shoes” when discussing this exposure and as such should be reviewed by all homeowners so as to better understand their policies.
Water backup is one of the most common causes of loss for homeowners, but it is also one of the most misunderstood. Most homeowners’ policies (and landlord policies, for that matter) provide coverage for water that backs up through sewers or drains as long as it (the backup) originates on your premises.
However, most companies require that there be a specific endorsement to the policy in order to provide coverage for damage caused by water back up that originates off the homeowner’s premises (street sewer systems, for instance). This optional endorsement has lots of names, depending upon the insurance company, but the endorsement is generically called Water Backup from Sewers & Drains.
Following are instances of water back up losses and how they are treated by insurance:
- Covered by the Homeowner’s Policy: The toilet or shower drain gets clogged and overflows, causing damage; this is covered on Safeco’s forms and often is covered under standard homeowner’s policy forms.
- Not Covered by the Homeowners policy:
1. A sewer line in the street backs up and causes the overflow in your home. (Exception: in Texas, this is covered by Safeco's Homeowners policy; if you have other policies in TX with other insurers, you’ll have to ask the TX agent);
2. Water that escapes, overflows or discharges from a sump pump, sump well or any other system designed to remove water which is drained from the foundation area
- Covered with the purchase of an optional endorsement for water back up:
1. Coverage is expanded to include backup or overflow from causes originating off your premises as long as the backup or overflow itself occurs on the premises.
2. Coverage is provided when water escapes, overflows or discharges from a sump pump or other similar system.
Insurance companies have variations of this endorsement (the options above are based on Safeco’s endorsement format), and coverage limits are offered “for sale” starting at $5,000 up to as much as $50,000 in some cases. If you have a mega-sized home, you likely have this coverage built into the policy. Yet, for most of us, the standard homeowners’ policies require this endorsement in order to obtain the coverage.
What’s never covered? Here’s the short list, as respects water overflow damage:
- Flooding is the most common excluded coverage. Whether the result of a river overflowing its banks or a dam breaking, water damage caused by surface water entering the house is not covered under a homeowners policy.
- Overflowing water originating off-premises is not covered either; this would include, for example, a sewer line breaking in the street and causing water to flow over the surface and into the house.
- And, sub-surface water is excluded. For example, if a swimming pool or sprinkler system leaks underground and causes water to seep through the foundation, there is no coverage under either the base policy or the optional endorsement.
So, now you know. While you can’t insure all types of losses, you are able to address the back-up of water through a simple endorsement to your homeowner’s policy, and you can purchase Flood insurance for surface Flooding exposures. Call us or your agent today, to ensure you have this extremely valuable protection!