Water damage – what’s insured, what’s not?

Canadian Direct release regarding insurance for rain and water damage.

Vancouver, BC, November 29, 2012 – With Winter comes the inevitable deluge of rain. Just like a good raincoat, your home needs proper protection to prevent costly water damage. Moisture inside the home also leads to mold, which causes health problems and can be difficult to remediate. Water leakage from indoor plumbing is a less obvious threat, but causes equally severe damage.


What’s covered?


If you’re one of thousands of British Columbians whose home is damaged by water each year, you likely have questions about insurance coverage. For instance, is damage from your leaky roof covered? How about flooding in your basement from the second-floor toilet?


In general, water damage resulting from sudden or extreme events is covered by your home insurance policy. However, damage arising from homeowner negligence is typically not covered.


“If you’re hit with damage from a severe winter storm, you’ll likely be covered,” explains Karen Hopkins-Lee, Chief Underwriter at Canadian Direct Insurance in Vancouver. “But leaking roofs and clogged eaves, which are the most common sources of outside water damage, are likely not covered by your insurance provider. That’s because the problem ultimately resulted from lack of maintenance. Debris-free gutters help ensure water ends up in the storm sewer – not inside your walls or ceilings.”


Indoor threats


Water threats also exist inside your home. Leaky indoor appliances can cause extensive damage. The most common sources of indoor water damage are plumbing connections, defective hot water tanks and indoor sprinkler systems – which can leak above your ceiling.




Mold is another type of damage that is typically not covered by a home insurance policy, and can be caused by outside or inside sources of moisture. Commonly found in bathrooms, kitchens, laundry rooms and basements, mold can also grow in your attic, where proper venting is a key deterrent. If mold persists, the source of moisture likely hasn’t been removed.


“The ‘smell test’ is a good way to assess whether your home is dry and safe,” says Hopkins-Lee. “If you or members of your family are experiencing respiratory problems, that’s another indication that you may have mold in your home.”




Regular inspections and upkeep is the best way to prevent water damage.


“I recommend a professional roof inspection every 10 years,” says Hopkins-Lee. “Your appliances and hot water tank should also be checked regularly. Anything involving water is a threat, particularly plumbing hoses that may be wearing out. As a homeowner, it’s also a good idea to familiarize yourself with shut-off valves for your home’s primary water supply and indoor plumbing.”


‘Fine print’


Some insurance policies require a visitor to check on your home daily when you’re away, so read the terms carefully.




Flooded basements are another common problem during the rainy season, and are often due to cracked walls or foundations, drain tiles in need of repair, sump pump failure or storm sewer back-up. Basement flooding can also be caused by indoor plumbing.


“We’ve seen instances of leaky second floor toilets causing extensive basement flooding while the homeowner is away on vacation. Basements aren’t the unfinished spaces they used to be. Renovations increase the cost of water damage claims, since remodeling often includes expensive furniture and entertainment systems.”




  • Remove leaves and debris from eaves and downspouts.
  • Check indoor appliance hoses for wear and tight connections. Use steel-braided instead of plastic hoses.
  • Winterize outdoor faucets to avoid frozen pipes: Turn off valves to outdoor faucets from inside the home, then drain the pipe by opening the external faucet.
  • Check your dryer vent. If your clothes aren’t drying properly, moisture may be collecting inside your home rather than venting outside.
  • Advise your insurance company of home improvements such as basement upgrades, so the replacement cost is reflected accordingly in your policy.
  • Ensure adequate venting in your attic and other crawl spaces.
  • Have someone check on your home while you’re away.
  • Get a professional roof inspection every 10 years.