Water damage is one of the more confusing coverages in a homeowners’ policy. Coverages are limited by the cause of the water damage and one such cause, that is often lacking in traditional coverage, is water backup. What is a backup, and how is it different from an overflow or discharge? All these things come into play when there is a water damage loss, and the cause of the water backup—or if it is considered an overflow or discharge—may make a difference in whether there is coverage.
First let’s look at definitions. A backup is an accumulation of water caused by a stoppage in the flow; something prevents the water from continuing down its path, so it builds up until it floods back the other way. A collapsed drainpipe, a blockage in the pipe, or a failed sump pump can cause a back-up. Backups can also be caused by heavy rain overfilling sewers, which in turn leads to wastewater being pushed back through the plumbing and into the home.
An overflow is when the water exceeds its boundaries; the space is filled to capacity and water then spreads beyond its limits. A tub left running creates an overflow. The tub can no longer hold the water running into it, so the water overflows onto the floor and surrounding area.
A discharge is the flowing or issuing out of water from the incorrect location; water coming from a pipe where it should not be. For example, an old, cracked pipe discharges water from a hole in the pipe. This scenario is not a back-up or an overflow, it is simply water issuing from a pipe at the wrong spot.
Standard home insurance policies can often exclude water backup, as well as other water damaged caused by outside water. Water backup coverage can be added to the policy for an additional cost and may be called a “water backup and sump overflow” endorsement. If you opt into this type of insurance, it covers damage caused by the intruding water as well as mold damage that commonly results following water or sewage backup.
Water damage is the third most costly home insurance claim—and if you don’t have the right coverage, that cost can become an out-of-pocket expense. Those who live in an area frequent to heavy rains or who have a sump pump or septic that could fail, or backup may want to heavily consider a water backup endorsement on their insurance coverage. However, clogged drains and sewer backups can happen to anyone, and insurance is meant to be a preparation for the worse case scenario.
Speak with one of the independent insurance agents at Magruder to discuss water backup coverage and see if it fits your coverage needs.