What Water Damage Is Covered?
The key to water damage coverage lies in understanding one critical distinction: sudden and accidental versus gradual damage. Your homeowners policy (typically an HO-3 form) covers water damage that is sudden and accidental, but excludes damage that occurs gradually over time.
💧 Key Coverage Principles
- Sudden and accidental: A pipe that suddenly bursts is covered
- Gradual damage: A pipe that slowly leaks over months is NOT covered
- Source matters: Water from inside the home is usually covered; water from outside (flooding) usually is not
- Resulting damage: Even if the source is excluded, resulting damage may be covered
Covered Water Damage Scenarios
- Burst pipes: Sudden pipe failures due to freezing, pressure, or age
- Appliance failures: Washing machine hoses, water heater failures, refrigerator ice maker leaks
- Accidental overflow: Overflowing bathtubs, sinks, or toilets (if truly accidental)
- Roof leaks from covered perils: Water intrusion from storm-damaged roofs
- Firefighting water: Water used to extinguish a fire in your home
Commonly Excluded Water Damage
- Flooding: Surface water, rising water, storm surge (requires separate flood insurance)
- Gradual leaks: Slow leaks from pipes, fixtures, or appliances over time
- Sewer/drain backup: Requires additional endorsement in most policies
- Groundwater seepage: Water entering through foundation cracks
- Neglect/maintenance issues: Damage from failure to maintain your home
| Water Source | Sudden/Accidental | Gradual |
|---|---|---|
| Burst pipe | Covered | Not Covered |
| Washing machine hose | Covered | Not Covered |
| Roof leak (storm damage) | Covered | Not Covered |
| Toilet overflow | Covered | Not Covered |
| Sewer backup | With Endorsement | Not Covered |
| Flooding | Not Covered* | Not Covered |
| Groundwater | Not Covered | Not Covered |
*Flood damage requires a separate flood insurance policy (NFIP or private flood insurance)
The "Resulting Damage" Doctrine
Even when the source of water is excluded, the resulting damage may still be covered. For example, if a gradual leak (excluded) causes mold damage that suddenly becomes apparent, the mold remediation might be covered under the "resulting damage" provision in your policy.
This is a frequent battleground in water damage claims. Insurers often try to deny entire claims by pointing to excluded causes, while ignoring covered resulting damage. Understanding this doctrine is essential for maximizing your recovery.
⚠️ Common Insurer Tactic
Insurers frequently deny water damage claims by arguing the damage was "gradual" or due to "maintenance failure" - even when the actual leak was sudden. Always document the sudden nature of the loss and be prepared to push back on these characterizations.
Step-by-Step: Filing a Water Damage Claim
- Stop the water source - Turn off the main water supply or the specific source. Document that you took immediate action to mitigate damage.
- Document everything - Before any cleanup, take extensive photos and videos of all damage. Capture the water source, affected areas, damaged items, and water levels.
- Notify your insurer promptly - Call your insurance company's claims line immediately. Note the date, time, claim number, and adjuster's name.
- Mitigate further damage - You have a duty to prevent additional damage. Extract standing water, run fans/dehumidifiers, and remove salvageable items. Keep receipts for all expenses.
- Do not discard damaged items - Keep all damaged property until the adjuster inspects. Take photos of items before disposal if you must remove them for health/safety reasons.
- Get professional assessments - Consider hiring a water damage restoration company and a plumber to document the source. Their reports can support your claim.
- Create a detailed inventory - List all damaged property with descriptions, approximate age, purchase price, and replacement cost.
- Review the adjuster's estimate - Compare it to contractor estimates. Challenge any discrepancies in writing.
California Water Damage Claims
CACalifornia's Fair Claims Settlement Practices Regulations provide specific protections for water damage claims:
- 15-day acknowledgment: Insurers must acknowledge your claim within 15 days
- 40-day decision: Insurers must accept or deny within 40 days of receiving proof of loss
- No unreasonable delays: Cal. Ins. Code Section 790.03(h) prohibits unreasonable claim delays
- Proper investigation: Insurers must conduct a thorough investigation before denying
- Written denial required: Any denial must be in writing with specific policy provisions cited
Mold Coverage Issues
Water damage often leads to mold growth, which creates additional coverage complications. Most modern homeowners policies have significant mold limitations:
- Dollar caps: Many policies cap mold coverage at $5,000-$10,000
- Covered causes only: Mold from covered water damage is typically covered (up to limits)
- Pre-existing mold: Mold that existed before the water loss is excluded
- Delay issues: If you delay reporting and mold spreads, coverage may be reduced
Maximizing Mold Coverage
To maximize mold coverage, report water damage immediately and document all mitigation efforts. If mold develops despite prompt action, document that the mold is a direct result of the covered water loss. Consider hiring an industrial hygienist to document mold extent and causation.
Fighting Denied or Underpaid Claims
If your water damage claim is denied or underpaid, you have options:
- Request a written denial: Ask for specific policy language supporting the denial
- Review your policy carefully: Many denials cite exclusions that do not actually apply
- Get independent estimates: Contractor estimates can challenge lowball offers
- Invoke the appraisal clause: For disputes over the amount of loss, appraisal may resolve the issue
- File a Department of Insurance complaint: This creates a regulatory record and may prompt action
- Send a demand letter: A well-crafted demand letter citing bad faith can change the insurer's position
- Consult an attorney: For significant claims, legal representation may be warranted