Do I need Water Backup Coverage?

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What is Water Backup coverage?

Water backup coverage is an optional add-on to your homeowner’s insurance policy. This coverage may help pay for water damage resulting from a backed up drain or sump pump. For instance, it may help cover the cost of replacing furniture or removing water after an unexpected backup.

Do I need this coverage?

Remember, this coverage is for water that “backs up” from a drain or sump pump. This does not cover water that flows from the outside into your home. Typically that will be considered a “flood claim,” requiring you to carry a flood policy.

Having a basement in your home will automatically increase the chance of a water backup situation. When there is a significant amount of rain in the area, the sump pump will work to help remove water that has accumulated in a water-collecting sump basin. It also will be used to prevent water coming into the home when the water table is above the foundation of the home. If and when a sump pump is overwhelmed it will shut down, instigating water to backup into the basement, causing possible water damage. The damage can be extreme, especially if the water is not discovered right away. We recommend this coverage on every policy, including renters and condo insurance.

What will this cover?

Water backup coverage will pay up to the coverage limit selected for expenses used to stop the water from coming in, including fans, generators, dehumidifiers, and hired restoration services. It will also cover expenses to restore your damaged home including personal property, flooring, drywall, etc.

How much coverage do I need?

This coverage is typically offered in increments of $5,000 up to a maximum of $50,000. However, this does vary by company some offering even higher limits. Be aware that ALL expenses incurred after the disaster are based on the limit you select. Restoration services, new carpet, new drywall, new personal property, electronics, couches, etc. That number will add up fast, and you’ll soon find out you have reached your limit. That is why it is important to communicate with your agent to confirm how much coverage you need. It is also smart to prevent as many unnecessary expenses as you can. You might consider having fans, generators, dehumidifiers at the ready, so as to proactively limit potential damages.

What do I do after I submit a claim?

During a claim situation be sure to document everything you have done including purchases (fans, generators, restoration services.) Take pictures of the damaged area and property. Communicate with your insurance adjuster. If you are working with a contractor to help clean up and/or restore damaged property, be sure to have them communicate and document the specific costs for the services.

How much is this coverage?

The cost of water backup coverage varies by company and policy, so there is no certain dollar amount. A good estimation would be around $40 per $5,000 of coverage. Also, be aware that there is a deductible tied to this coverage. Stay educated on the coverage you have so there are no surprises in the event of a claim.

How do I add this coverage to my policy?

Call your agent and ask what it would be to add this coverage. Discuss how much coverage to add and how much the deductible will be. The agent then will be able to give you a firm indication of what it will cost to add water backup to your policy.