Ground Water Could Sink Your Investment

Flood Insurance, Ground Water

Will flood insurance cover your basement if ground water enters your home?

After a record breaking snowfall year, Roger L. Daniel Insurance is advising clients to be mindful of water around their home this spring.

As we write this post Billings, MT just broke an all-time record for snowfall. If the moisture continues, many in our area will have water in their basements as the spring rains hit.

Ground water is not covered by a homeowners insurance policy.

Ground water potentially can be covered by a flood policy but remember – make sure to read the flood policy to understand what is covered for ground water. Understand the difference between replacement cost and actual cash value in the flood insurance contract.

Did water get into your home?

Roger L. Daniel Insurance strongly recommends having a professional remediation company come out and assess the damage. They will dry out the drywall, carpet and other damaged areas. Areas that are left wet for a long period of time can create mold and no one wants to deal with mold.

What if the rain continues to come? 

If our area has a wet summer there will be water damage in many basements.

First, let’s take a look at what homeowners insurance policies generally cover in regard to water damage and some typical exclusions we see in insurance contract.
Most homeowners insurance policies will cover water damage from a cracked, broken or burst plumbing device that causes damage to the interior of the home. The key language in most contracts is “sudden and accidental.” The sudden and accidental language means that the damage cannot happen over a long period of time.

Homeowners also need to know that if a contractor fixes your roof for example, and then the roof leaks in the subsequent months or years, your insurance policy will usually not pay for the contractor’s mistake in repairing your roof. If the interior of the home is damaged, the homeowners insurance policy generally will pay, but the insurance company will decline to fix your roof. We have seen many instances where contractors have not properly installed flashing around chimneys, or did not put on the ice and water shield at the end of the roof.

Flood insurance and ground water.

Homeowners insurance will typically exclude coverage for water that comes from an outside source. Flooding, rising ground water and gutters without extensions are risks each homeowner must understand.

The National Flood Insurance Program (NFIP) issues policies for homeowners. The program will allow for coverage up to $250,000 for the home. Check with your local insurance agent to see what the price of flood insurance is and if it makes sense for you to buy a policy. The NFIP is a low cost way to transfer risk but the homeowner needs to read the coverages that the NFIP will provide as the coverages are different depending on the flood zone rating the home is in. The National Flood Insurance Program (NFIP) is a great source for more information.

What about your rain gutters and down spouts?

The last topic we will cover are gutters.

Make sure the gutters around the home are working properly and extensions are in place. Earth movement including settling of foundations is excluded on homeowners insurance policies. Too much water near the foundation can cause settling.