Not too long ago, I was enjoying time with friends on their porch and I commented on the new holes in their lawn.  No, it wasn't gophers.  Turns out they had just had a terribly expensive surprise visit from the plumber due to their old pipes bursting.  It cost them a cool $10,000.  

I'm pretty sure most of us don't have $10,000 just lying around waiting to be spent on new pipes.  This is a problematic trend amongst American homes.

One of the more common culprits is an upstairs laundry room.  Who'd have thunk?!  Upper units cause more expansive damage as the water moves its way downstairs.  Aging homes also means aging pipes, and those are also to blame. 

You'd assume the majority of home insurance claims are coming from natural floods and disasters.  No, it's not from weather-related events but from old pipes and valves, worn-out hoses on second-story washing machines, and faulty connections from appliances that use water, The Wall Street Journal reports.

Insurers are getting more and more reports of water damage. One in 50 homeowners filed a water damage claim each year between 2013 and 2017, according to Verisk Analytics’ ISO insurance analytics unit. Insurers have faced a $13 billion water damage bill from insuring homes.  And the average cost is the same as my friend's untimely bill... $10,000.

So what does all this mean when it comes to your homeowners insurance?  

Please note that not every water damage bill will be covered by insurance.  Standard homeowner policies exclude storm surges and river flooding from coverage. Also, most homeowners’ policies will cover “sudden and accidental” damage but not routine maintenance. So if you've been ignoring that slow leak in the basement the past few months, you may find that your insurance company won't be footing the bill.

As your insurance broker, it's not only our job to help you understand the inner workings of your policies but common issues and how to avoid them.  Keep on your pipes and repairs, reconsider the upstairs laundry room, and you'll thank us in the long run.  Let's put that $10,000 to more enjoyable use.

Source: “American Homeowners and Their Insurers Face a Flooding Crisis From Within,” The Wall Street Journal (March 8, 2019) 

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