When water damages your property, you often need to replace almost everything that got in contact with water. Usually, this means that everything from floors, walls, and other structural components of your house must be fixed, while furniture and household items need to be replaced. As you can already tell, this kind of home restoration is incredibly expensive, and it also takes quite some time to get done, which is why most people seek help from their insurance company.
With that said, it’s critical to understand the difference between flood damage and water damage. And those differences tend to matter a ton when it comes to what your insurance company covers.
What is Water Damage?
When insurance companies talk about water damage, they often mean damage caused by a mechanical or structural failure. Often, that’s also the kind covered under a BOP (commercial businesses owner’s policy). Typically, the type of damage that you can receive compensation for and is covered by BOP includes:
- Water leaking from the roof causes structural damage to the walls (wood rotting and mold growing).
- The sink is overflowing, thus ruining other inventory and household items.
- Pipe bursting and thus flooding your entire home or some parts of it.
What is Flood Damage?
According to the Federal Emergency Management Agency (FEMA), a flood is any event that results in a full or partial inundation of more than two acres of land that’s typically dry or two or more properties. Flooding can be caused by natural disasters and severe weather events that suddenly cause water flow to increase. Most commercial insurance companies don’t typically cover these kinds of damages. If you’re a business owner, your best option is to consider buying coverage through the National Flood Insurance Program (NFIP). In most scenarios, floods are caused by the following:
- Overflow of lakes, rivers, or other waterways
- Tidal waves or hurricanes
- A large accumulation of rainwater
- The sudden melting of snow or ice
- Runoff of surface water, regardless of the source
- Landslides or mudflow
What’s the Difference Between Flood and Water Damage?
Most people assume that water and flood damages are the same. After all – in both cases, it’s water that causes damage to your property. However, those terms can never be used interchangeably for insurance companies and the coverage they offer.
As we already defined, water damage refers to structural/mechanical issues, whether that’s an overflowing sink, a flooded air-conditioning unit, or a burst pipe. On the other hand, flood damage often refers to problems caused by severe weather or natural disasters. It typically leads to more serious issues such as an overflowing river, flash flooding, or sump pump failure. For insurance companies, it doesn’t matter that water caused damage. They care about the reasons why the damage occurred in the first place, which is why they put human errors or plumbing failures in one category and natural disasters in another.
What Does a Homeowner’s Insurance Cover?
Most people assume that a homeowner’s insurance policy will cover flood damage. However, as we already mentioned, when it comes to insurance companies, water and flood damage are two separate things, and a homeowner’s insurance often does not cover flood damage. That’s why, if you live in an area prone to floods of any kind, you need to have separate insurance to get coverage in case a disaster occurs so that your policy will cover repairs.
Homeowner’s insurance usually covers water damage restoration. It’s probably one of the main reasons you should consider holding a policy in the first place. Even if we don’t like to talk about it, every family will likely experience some kind of water damage to their home at least once, so it’s good to be prepared to cover the expenses.
Do You Need Flood Insurance?
Most people are under the impression that getting flood insurance is unnecessary. However, that’s not the case – even if you live in an area where these kinds of natural disasters rarely occur, nothing can guarantee that you won’t end up living through one in your lifetime. Also, assuming that you won’t be impacted because your home is on an elevated lot or because it’s built several feet above the ground is not a good idea – in the case of extreme weather conditions, any home can suffer damage. The good thing is that flood insurance is easy to get, and the less likely it is for a flood to occur in your area, the cheaper the policy will be. So, our advice is always to be prepared.
Call us if you’ve recently suffered water or flood damage and need help filing your insurance claim or receiving adequate coverage. We will help you by evaluating the damage and repair costs and looking over your insurance policy. That way, you can be certain you’re getting paid what you deserve.