Understanding the Difference in Homeowner’s and Flood Insurance Policies
Many people are unaware of the differences between what constitutes water damage and flood damage, and the two terms are often conflated. When homeowners are dealing with this type of damage to their property and belongings, they wonder if their insurance policy will actually be able to cover the loss. As usual, it will depend on the type of insurance the homeowner chose to buy, as well as how the water entered the home.
What Insurance Policies Involve Damage from Water?
Typically, there are two insurance policies that will involve damage from water. They are:
Flood insurance policy
Homeowner’s insurance policy
If losses are not covered by one of the policies, they may be covered by the other. It’s important for homeowners to realize that a typical homeowner’s insurance policy will not generally cover flood damage. Depending on where someone lives and the potential dangers of flood, the owner may want to buy both of these types of policies. Homeowners who are buying policies should speak with their insurance companies so they know exactly what their policy covers. This will help to give them a better idea of what type of insurance they need to buy.
What Does Flood Insurance Cover?
A flood insurance policy will provide coverage up to the limit of the policy for damage caused by a flood. When determining whether damage to property was from a flood or due to water damage, it is important to understand the semantics. Flood refers to rising water, and if the damage to the home is caused by rising water, then it will likely be considered flood damage. If the river rises and the water comes into your home, it is flood damage. If there is a heavy rain that the ground can’t absorb fast enough, it is typically considered flood damage as well. If water is in contact with the ground before entering your home, you can be relatively sure it will be considered flood damage.
The only way to ensure you have protection from events such as this is to have a specific flood insurance policy. Other types of insurance, including your homeowner’s policy, will not cover this. As mentioned, this is one of the things that the homeowner’s insurance will not protect. Those who live in an area that’s prone to flooding should always have flood insurance, just to be on the safe side.
What Does the Homeowner’s Policy Cover?
Even though it will not cover flood damage, it does provide coverage for many types of water damage to the home. In this case, the water cannot have come into contact with the ground before entering the home. For example, if rain soaks through the roof, you have a broken water pipe, or a storm breaks a window and soaks the carpet, then it would be considered water damage and would be covered by the homeowner’s policy.
Things Get Complicated
Of course, sometimes there are not cut and dry (pun intended) ways of determining what water damage and what flood damage are. For example, there could be situations that have elements of both, which means that both of the policies would come into play and would pay for each of the various types of damages. However, they will not duplicate coverage. Instead, they will offer complementary coverage.
Which of these policies are essential? Should you buy both? You should make sure you speak with a specialist about the best type of policy for where you live. Contact us today, and we’ll let you know what you need to do to protect your belongings, home, and your family.