How a Swimming Pool Affects Your Homeowners Insurance

If you are thinking of buying or building a swimming pool, it's best to contact your home insurance company first. Pools are a liability and, like trampolines, are an “attractive nuisance.” The owner of a pool is liable for anyone who uses it whether they have permission to or not. 

Home insurance generally covers the pool itself, too. A claim for damage to a pool might fall under one of three portions of your home insurance policy, depending on the pool and insurance carrier. We’ve broken down and explained all of the above mentioned scenarios below. 

Does My Home Insurance Policy Cover My In-Ground Pool?

The short answer is, yes, it usually does and we've seen that it adds a small fee to your premium of roughly $50. But in-ground pools create somewhat of a home insurance snafu. All homeowners policies cover your home itself and any extraneous structures (such as a tool shed), and a carrier might consider a pool to be either one. Knowing which of these coverages a pool falls under is important because it will either impact your replacement cost value or personal property limit of your policy.

For example, say your home insurance company includes in-ground pools in the replacement cost value of your policy. Most in-ground pools cost roughly $20,000 to install but some cost more. Increasing the replacement cost value by that amount will consequently increase the cost of your home insurance premium because of the new maximum claim limit.

Some home insurance companies consider a pool to be an external structure - something detached from the home but does not fall under a policyholder’s personal property. If that is the case, your pool needs to be declared and listed on the policy, just like a shed or any other extraneous structure. You also might need to pay for more coverage. In most policies and companies that we've seen, homeowners insurance covers the cost to replace external structures up to 10% of the overall policy replacement cost value. So if the replacement cost value of your home is $100,000, then your policy likely only covers up to $10,000 in damages to external structures. If you find yourself in that circumstance, you will need to purchase additional coverage for external structures or know that only half the replacement cost of your pool (based on a $20k cost) would be covered.

The good news is that claims for in-ground pools are uncommon because there are few perils that might seriously damage them. They are not susceptible to the wind, water and fire damage that homes are. One example of a claim for an in-ground pool might be if a tree were to fall on and destroy part of it.

Above-Ground Pools and Home Insurance

Some above-ground pools are considered personal property, like watercraft or firearms. Unlike an in-ground pool, above-ground pools come out of a box, so to speak. They are assembled and can be disassembled if need be and if they can be considered “portable,” then an insurance carrier will likely label them personal property. Even if a deck or other permanent structure is built around an above-ground pool, it is the portability of the pool itself that determines its categorization. 

For example, say your carrier determines your pool is not a permanent structure and is instead your personal property. Most home insurance policies cover personal property up to 75% of the replacement cost value of the home. So if your policy was written for a replacement cost value of $200,000, then your home insurer also would cover up to $150,000 of your personal property. In this case, ask your insurance company if there is a claim limit for swimming pools. If there isn’t, then you don’t need to purchase additional coverage (unless you have an extremely expensive pool in your yard). If there is, and you want the full value of your above-ground pool to be protected, you should get extra coverage.

How Having a Swimming Pool Impacts Your Liability Coverage

The liability protection provided by home insurance policies covers pool-related incidents. This includes any medical expense or lawsuit as a result of a pool-related injury or death. This excludes the policyholder and their household, who would need to file a health insurance claim to cover the medical costs associated with an injury or pay out of their own funds.

Swimming pools are considered an attractive nuisance, which is something on someone’s property that might attract a child and pose a risk to their well-being. The owner of a property with one, such as a pool, is liable for anyone who uses it whether they have permission to or not. More than 1,000 children drown in swimming pools in the U.S. each year and many more are injured, according to the Center for Injury Research and Policy. 

For this reason, the standard amount of liability protection in most insurance policies might not be adequate. Typically, policies include $100,000 of liability protection, but it is widely recommended that policyholders purchase as much as $500,000. As you can imagine, a lawsuit for the death of a child (or anyone for that matter) can exceed the $100k of protection. You can increase the limit of your personal liability coverage or purchase a separate umbrella policy, which would cover the cost of any liability claim surpassing the limit of that portion of your policy.

Swimming Pools and Unacceptable Insurance Risks

The best insurance companies will cover swimming pools and the liability associated with them, but there are stipulations to the coverage. Whether it is an in-ground or above-ground pool, insurance companies require them to comply with the laws of the local municipality. Almost all cities and towns require you install a fence to enclose around the pools, the property where they are located, or both. If you don't have a suitable fence, for example, then your carrier will exclude them from your liability coverage.

In addition to not being up to municipal code, there are some things that exclude both in-ground and above-ground pools from coverage. It is common for home insurance companies to exclude pools with slides and diving boards - these generally present a higher risk for injuries and medical expenses.

Policyholders also must keep up with the maintenance and drain the pool in the winter to prevent damage. Any damage as a result of neglect on the part of the policyholder will not be covered.

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