November 30, 2015 By Patrick Prendiville, CIRMS Prendiville Insurance Agency Education
Water damage insurance claims are by far the most common made by homeowners, when compared to other perils such as fire or theft. With El Niño making its appearance this year, it’s important to understand that, although Crummack Huseby covers El Niño claims very effectively in this newsletter, it’s only part of the story when it comes to water. Policyholders need to know exactly what their homeowner or condo insurance policies may cover. Sudden and accidental discharge and cracking or ruptures of a pipe or appliance containing water are usually covered. Examples of these types of claims are: washing machine hose bursts, refrigerator line ruptures, slab leaks, interior sprinkler discharges, and toilet breaking.
Other types of water damage claims may not be covered. Water damage from events 14 days or longer, natural floods, slow leaks from pipes, and falling rain (unless the building is first damaged, typically wind damage) are typically excluded from insurance policies.
The best time to become knowledgeable about water damage is before the damage occurs. Homeowners can be best prepared if they follow a few basicpreventative steps.
If you’re in a single family residence, talk to your agent about the particular details of water damage coverage. Review your deductible to make sure it’s the best value.
If you live in a condo, make sure you understand completely where the association policy leaves off and your individual policy takes over. Coverages that a unit owner may rely upon from the association policy can differ extremely. Some condo associations cover the structure up to and including the drywall only, while others cover all floor and wall coverings, cabinetry, appliances, counters, plumbing and electrical fixtures. Still other association policies cover what the builder installed and completely ignore any and all homeowner made improvements. This is why it’s extremely important for you to know what you need to insure. Have your personal insurance agent review your CC&R’s to determine the proper level of coverage. Another important factor for condos is the deductible, which could be as high as five, ten or twenty thousand dollars, verify what your individual policy will cover. A properly designed individual policy will cover the association deductible.
Tips for good loss control techniques
If you’re leaving for the holidays, turn off the valve at each toilet, sink, and washing machine. Better yet, turn off the water main if you can do so without eliminating fire sprinklers or other necessary items.
Hire licensed contractors to make plumbing repairs, or to install water filters and appliances.
Check your shower pan for cracks.
Invest in washing machine hoses that won’t break, such as stainless steel.
Even if you have taken all the preventative steps possible, things still happen. Your insurance company not only encourages you, but requires you to take steps to prevent further damage.
Call a plumber and/or a restoration contractor in order to stop the water source and start the dry-out process.
As soon as practically possible, call the insurance company and file a claim. This means that single family residence home owners will call their own insurance company. Condominium unit owners will notify the association (manager) as well as their own insurance carrier for their unit owners policy.
Don’t fall into the trap of only notifying the association insurance or your individual unit owners policy. Notifying both will help in getting a speedy resolution, and it’s easy to withdraw a claim if it’s discovered that the use of one policy will handle the entire damage.
There was a time when insurance companies routinely covered mold damage in their policies. Following a decade of seeing mold claims explode, mold is usually not covered. In the few policies that have maintained coverage, it is very limited. Mold can start growing within 48 hours of water damage and the cost to rectify it is often in the thousands, and sometimes tens of thousands, of dollars. Because of this, it’s important to be proactive in identifying and rectifying water damage, whether the insurance covers the cause of loss, or not.
Being prepared for a water damage claim is the first step in protecting your home. While not all water damage claims are covered, many types of catastrophic water claims are. Whether your particular claim is covered or not, there is little doubt that a proper insurance review will go a long way towards making sure that your claim is as easy as possible to resolve.
About Prendiville Insurance Agency
For nearly 30 years, Prendiville Insurance Agency has grown to be an industry leader in Homeowners Association (HOA) insurance. While representing over 35,000 units, they have become one of the Nation’s largest Farmers Agents. Prendiville Insurance Agency specialty is educating homeowners and board members, supplying critical information to banks without hassle, and providing unrivaled advocacy in times of a claim.
As multi chapter members of the national organization Community Association Institute (CAI), Prendiville Insurance Agency keeps ahead of industry trends. Three Prendiville staff members hold the prestigious CIRMS (Community Insurance Risk Management Specialist) designation as well as serve on multiple committees in multiple chapters. In 2012, Patrick Prendiville served as the Chapter President for the Orange County Chapter and was honored in 2014 with the Outstanding Service Award. For more information, please visit prendivilleagency.com