Water damage is one of the most common types of loss for homeowners and is also one of the more confusing aspects of insuring your home or condo.

One of the reasons for confusion is there are two separate insurance policies – home or flood insurance – that may respond based on the cause of water damage to your home.

In general, home insurance policies exclude flooding damage – whether the overflow of a nearby body of water or subsurface water that seeps into your home. Home policies also specifically exclude water that backs up through a sewer, drain, or sump pump.

Insurance companies offer water backup coverage as an endorsement – an optional coverage available for an extra charge. Water backup coverage is typically offered in $5,000 increments providing flexibility to tailor the coverage to your specific situation.

A homeowner with a sump pump in an unfinished basement may not have the same risk and resulting need for coverage as a homeowner with a finished basement where a water backup loss could damage flooring, baseboards, drywall, cabinets, and furnishings.

Recognizing water backups as a common cause of loss many insurance companies include a modest amount of coverage, typically $2,500 to $5,000, within packages of coverage benefits customarily included with many home insurance policies.

With the ability to choose your level of water backup coverage there is added responsibility, as a homeowner, to consider the likelihood and possible extent of damages in your home if a water backup loss occurred.

Click to read our related article: How much Water Backup Coverage Do I Need?

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