Does Homeowners Insurance Cover a Flooded Basement?

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A flooded basement presents a lot of variables when it comes to insurance coverage, because the cause of the flooding is what determines whether it'll be covered. Some situations are covered by standard home insurance, but others may only be covered if you have a special endorsement or a separate flood insurance policy. Below are the most common ways your basement can flood, which type of insurance you would need in each case and whether you are covered.

When does homeowners insurance cover a flooded basement?

There are numerous reasons your basement could flood. If any of the following happen in your basement, you will likely be covered by a standard homeowners insurance policy — as long as the damage didn't occur due to negligence on your part.

Flood caused by a broken appliance

If the washing machine, AC unit or refrigerator in your basement malfunctions and floods the entire room, the resulting water damage is typically covered under a standard homeowners insurance policy. However, the repair or replacement of the appliance itself won't be covered under the claim.

Flood caused by a leaking water heater

If your water heater leaks, the damage is covered under the same provision as leaking appliances. But remember, if your insurer finds any proof that the cause of the leak was poor upkeep on your part, your claim will be denied.

Flood caused by freezing pipes bursting

If the temperature drops and your pipes burst due to freezing water, your homeowners insurance policy would cover the damage from that flood. Burst pipes from an AC unit, sprinklers or an appliance are also covered if they freeze, as long as you are living in the home when the flood occurs or can prove you were still maintaining the home with heat or had turned off all the water systems. This is something you should consider if you have a secondary home in a cold climate or vacation in winter.

Flood caused by an overflowing tub, pool, sink, or toilet.

You may be surprised to learn that if your basement floods as a result of an overflowing tub, pool, sink or any other water receptacle, you would be covered by your homeowners insurance policy. Such a calamity is considered "sudden and accidental," and your insurer will foot the cost of replacing what was destroyed. So, if you experience a tub or toilet overflow, homeowners insurance will typically cover the resulting flood damage.

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When doesn't homeowners insurance cover a flooded basement?

Unfortunately, there are also situations where basement flooding would not be covered by your homeowners insurance policy. The following situations are not covered by a standard policy:

Rising water from a storm surge or heavy rains

Essentially, any flooding caused by nature will not be covered under your homeowners insurance policy. For all rising water situations, only flood insurance can save your basement — and even then coverage is limited.

Flood insurance covers personal belongings and appliances in your basement, but it typically won't cover the structure itself or finished ceilings or floors. When you take out a flood policy, you need to purchase both dwelling and contents coverage to get the maximum protection for your basement.

The best defense against a flooded basement is a functioning sump pump that pushes water out. Preventing a flood from occurring in the first place is the cheapest and least disruptive option, especially if you have a finished basement. You can buy additional water backup or sump pump coverage as part of your homeowners insurance policy as well, which ensures your basement for up to $25,000 in case the sump pump fails. Of course, it would have to be a malfunction and not the result of poor upkeep of the system.

Prevent leak damage with a water monitor

Water leak detectors are inexpensive devices that make a loud noise or send an alert to your smartphone when they get wet.

If there are areas in your basement that are prone to flooding, such as around the washing machine or the drain by the water heater, place a water detector on the floor there, and you'll be notified if water has started to overflow. They often can be purchased for less than $20.

Sewage backup

If an external sewer system backs up into your home and basement, your insurance will not cover the resulting damage. Sewage backup can be one of the most costly disasters that can befall a home, and there are few ways for homeowners to recoup their losses should it happen.

Most insurance companies do offer an endorsement for sewage backup, and it is relatively inexpensive but only covers up to $10,000 worth of damage. That's not enough monetary protection in most cases. Sewage backup can easily cost hundreds of thousands of dollars to repair.

Water seeping from underground

If the ground becomes saturated with water from a heavy rain, and that water seeps through the ground into your basement, homeowners insurance companies do not consider this a coverable calamity.

Flood insurance also won't cover it, unless the seepage is directly related to a flood in the area. The best defense against this disaster is to make sure the foundation of your home is solid and up to date on all inspections.

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