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Overland Water Insurance: Am I Covered for Water Damage?

By September 7, 2018Personal Insurance
downspout leaking

Damage from storms, spring thaw, and other fresh water flooding is occurring everywhere. In fact, severe weather damage claims paid by Canadian insurers increased more than 13-fold over the past 30 years which makes it the leading cause of home insurance claims, and a risk that many insurance policies don’t completely cover. With so many questions surrounding Overland Water Protection, we’ve broken down everything you need to know.

What Qualifies as Overland Flooding?

Understanding what is and is not considered flooding from an insurance perspective is critical. In general, flood damage occurs when a large amount of water flows over dry land and enters your home.

Overland flooding is defined as flood waters flowing from an outside source or body of water onto dry land, causing water damage. The two most likely causes of overland flooding include snowmelt and rainstorms. Overland flood insurance covers flooding from surface water accumulation as well as from bodies of water, such as lakes, rivers or streams.

Is Water Damage Covered Under my Basic Policy?

Every home policy is insured against basic water damage losses. Basic water damage coverage included with your home insurance policy covers you for water-related losses such as:

A leaky hot water tank, a burst pipe, a flooded dishwasher or washing machine, ice damming on your roof and water from an above ground pool entering through your basement windows.

What types of Water Damage is not covered?

Certain water damage losses are never covered by insurance policies. These losses include:

  • Pre-existing seepage or leakage.
  • Rain or snow entering through an open window.
  • A leaking roof due to wear & tear.
  • Tsunamis, tidal waves, or other coastal flooding.

Know the Coverage

With overland flood insurance, it is important to understand what is and what is not covered. Overland flood insurance covers damage from freshwater sources. Overland water insurance does not accept claims where flood damage is the result of a saltwater source, such as coastal flooding and tsunamis. Dam breaks are also specifically designated as uncovered occurrences.

Where to Turn for Flood Coverage

Flood waters have the power to damage not only your home but also your financial future. When it comes to protecting homes from floods, most property owners assume either federal disaster assistance or their home insurance policies will provide adequate coverage. This is often not the case. We’re here to ensure you have the proper flood insurance in place when you need it most.

Disaster Assistance May Not Be Available to You

While government disaster assistance funding is available to some following massive flooding, it’s not guaranteed. In fact, relying solely on disaster assistance is dangerous for the following reasons:

  • Disaster assistance is typically only available through the Disaster Financial Assistance Arrangements program when a disaster is officially declared by the government. Even if a disaster is declared, homeowners still must meet several qualifications to receive aid.
  • Homeowners who don’t have flood insurance—despite living in an area where it is readily available—may not be eligible for disaster assistance funding at all.
  • Disaster assistance is often a loan that must be repaid (with interest). This cost is in addition to the mortgage loan that you still owe on the damaged property.
  • Even if they receive aid, residents may not receive enough compensation to cover their losses.

If your home is flooded and disaster assistance isn’t offered, you’ll have to shoulder damage costs alone.

Your Home Insurance Policy Might not Protect Against Overland Floods

While home insurance policies may offer coverage for water damage from sewer backups or pipe bursts, they commonly exclude losses caused by overland floods.

While newer policies can include some level of flood protection, availability varies. What’s more, even comprehensive home insurance policies (which often offers the best available protection for homeowners) don’t automatically provide broad protections for water damage.

To truly protect your home from floods, you can’t rely on standard home insurance policies alone. Instead, you should turn to new forms of protection, like overland water endorsements.

Overland Flood Endorsements

Standard home, condo (strata) or tenant policies often exclude overland flood damage coverage. However, because extreme weather events are becoming more frequent, many insurers are now providing policyholders with the option to purchase add-ons (endorsements).

In general, overland flood endorsements provide a level of flood insurance that was previously unavailable. Specifically, the overland flood endorsement can protect against damage resulting from melting snow, excess rain and overflowing riverbeds.

If you live in an area that is prone to flooding, it’s critical to speak to us about overland flood endorsements. For more information, check out this video from Aviva Canada.

We’re Here to Help

Floods can occur without warning, and it’s important to be prepared. Contact us to learn more about your flood coverage options.

Author Jamie Ross

Jamie Ross leads the Marketing and Communications team at Wedgwood Insurance, renowned as one of Atlantic Canada’s premier independent insurance brokers. Bringing a wealth of experience amassed over many years at some of Canada's most esteemed advertising agencies, Jamie transitioned to the insurance industry in 2017. This pivotal move has marked a period of significant professional growth and contribution to the field. A native Nova Scotian, Jamie has been a resident of St. John's, NL, since 2011, where he has become an integral part of the local community. Learn more about Jamie.

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