Say What? A Policy That Does Not Cover Any Water Damage

Originally published by Kenneth Kan.

I look at insurance policies day in and day out—it’s just a part of my job. Every now and then, I come across something that makes my head spin or causes me to do a double take.
Readers of this blog have seen some of my posts where I implore homeowners to read their homeowner insurance policies and ask questions if there are terms or provisions they don’t understand. Well, most homeowners purchase policies for protection in case of fire and theft. Although water losses are the most common type of loss that result in claims, most homeowners are unaware that not all water losses are covered. That said, it is standard that a “sudden and accidental” escape of water from a plumbing system causing physical damage is covered. However, take a look at this water exclusion from this policy and also the definition of “water damage”:

If you are reading it as I am, here, even a “sudden and accidental” water loss under this policy is not covered! So, a…

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