Does Homeowners Insurance Cover Water Damage?

Water damage is sometimes, but not always, covered by a standard homeowners insurance policy. It depends on the cause: sudden internal water damage is covered, but damage caused by neglect or lack of maintenance, as well as flood-related damage, is not.

It's not always clear when water damage is and isn't covered by your insurance policy. Continue reading to find out if you're covered.

When does homeowners insurance cover water damage?

Water damage is covered by standard home insurance policies if it is sudden and internal, with the caveat that the water has never touched the outside ground. This means that the water damage had to be caused by one of the 16 perils covered by homeowners insurance, such as the sudden and accidental tearing, cracking, burning, or bulging of a steam, heating, air conditioning, or automatic fire protection system.

When water damage is covered by homeowners insurance:

  • Rain or snow storm
  • Plumbing: burst pipes, frozen plumbing, faulty plumbing, accidental overflow
  • Water damage from extinguishing a fire
  • Leaking roof (coverage would apply only to the home interior, not the roof itself)
  • Accidental overflow of an appliance or fixture (toilet, washing machine, bathtub)
  • Vandalism
  • Mold (only as a result of covered water damage)

When does homeowners insurance exclude water damage?

Water damage isn't always covered by homeowners insurance if it isn't the result of an accident or a sudden, unanticipated occurrence. Water damage caused by neglect or lack of maintenance puts you personally on the hook for the cost of repairs. Water damage is not covered by homeowners insurance in the following situations:

  • Ground seepage
  • Water or sewer pipe backups
  • Flooding
  • Poorly-maintained pipes leading to leaks

Water damage caused by a flood is also not covered by standard policies. You'll need flood insurance for that, especially if you live in a high-risk area prone to flooding, such as Louisiana.

Mold from water damage

Mold is all too common and is frequently discovered after water damage to your home, but it is frequently not covered by homeowners insurance. Though it can cost up to $30,000 to rid your home of a mold infestation, your home insurance may help cover mold removal — depending on what caused the mold in the first place.

When is mold covered by homeowners insurance?

  • Mold is covered by your home insurance if it is caused by water damage from a common peril. Because mold is considered an extension of water damage, if situations such as burst pipes or an AC system overflow allow mold to grow, your homeowners insurance will cover all or some of the mold removal costs.

Most homeowners insurance policies cover mold remediation up to $5,000, though some policies cover up to $10,000. You can also add extra mold coverage to your home insurance policy by purchasing a floater or endorsement.

Mold damage is generally covered by home insurance as long as it is not the result of neglect or lack of maintenance.

Mold can grow in your home if a pipe has been leaking for months and has not been repaired, but your homeowners insurance will not cover it. Because floods can cause mold, any mold that grows as a result of a flood would be covered by flood insurance, if you have it. If you file a claim for mold damage, the flood insurance adjuster will evaluate and determine the cause.

Mold can be prevented by keeping your home dry and addressing spills and leaks as soon as they are discovered. While this may be more difficult for homeowners in naturally humid states like Florida or Louisiana, we recommend using vents and fans to reduce moisture and humidity in areas and appliances that are prone to it.

Maintain your home's repairs and maintenance, especially in basements, crawl spaces, and bathrooms, which are ideal places for mold to grow. Bleaching the area after a spill or leak can also help prevent a mold infestation.

How to file a claim after water damage

Now that you know when water damage is covered by your homeowners insurance, you must contact your insurer as soon as possible after discovering water damage in your home. You should photograph the affected area and everything that was damaged, as well as the source of the water, such as a burst pipe or a hole in the roof.

Find any pictures you have from before the incident so you can show the adjuster what the area looked like before it was damaged. Pictures are especially useful if mold develops in the future, as they can support your claim that the mold grew due to water damage rather than neglect.

Your insurer will ask you questions about your claim to determine whether it is covered by your policy. The damage will then be assessed by an adjuster. If you need to make any urgent repairs before the adjuster arrives, take pictures of the damage and keep the receipts for any materials you purchased.

You can also hire a contractor to assess the water damage and provide you with a cost estimate to repair it. This is useful if the insurance adjuster's quote for coverage is too low, as it allows you to bargain with your insurer. When you and the insurer have reached an agreement on a reasonable settlement for the cost of repairs, the insurer will usually send you an advance of about half the payment to begin repairs. The remainder, less the deductible, will be paid to you upon completion.

Keep pictures of the water damage as well as all documents related to the damage and your claim in case mold grows in the future. Your insurance company may be hesitant to agree that any potential mold is the result of prior water damage, but having photos and records on hand will serve as valuable proof of your claim. If the mold is determined to be the result of water damage, some insurers may require you to file a second claim for water damage, requiring you to pay another deductible before remediation can begin.