Flood Insurance for Your Home
Generally, flood damage occurs when a large quantity of water flows over dry land and seeps into your home through doors and windows. Sources of water include nearby rivers, lakes, melting snow, rainfall, and even swimming pools.
Most home policies will cover water damage if it is “sudden and accidental” and not caused by freezing. Water entering the home through leaks, cracks, and seepage are considered to be the responsibility of the owner and should be prevented through routine home maintenance.
However, unforeseen flooding is usually not covered in home policies.
If this news comes as a surprise to you, you are not alone. A recent survey from a Vancouver-based insurance agency found two-thirds of Canadians surveyed incorrectly believed that flood protection is included in a typical home insurance policy.
Here’s a more detailed look at what is and isn’t typically covered in home insurance policies, according to the Insurance Bureau of Canada:
The key to water damage coverage is “sudden and accidental” incidents that are not caused by freezing, such as the following:
- Water damage caused by indoor plumbing, heating, or air conditioning emergencies, although the cost of repairing the source of the problem is not covered.
- Indoor or outdoor domestic appliances on your property (i.e. washing machines, dishwashers etc.), although the cost to repair the appliance is usually not covered.
- Broken water main.
- Wind and hail damage to exterior and interior.
What’s not covered
- Damage from freezing of indoor plumbing. If you’re away from your home for more than four consecutive days, during the normal hunting season, you must drain the plumbing or have your home checked daily to ensure that heat is maintained. If freezing-related damages do occur despite these precautions, it will be covered under most policies.
- Damage from freezing outside the home (i.e. melting or moving snow).
- Leaking roof.
Flood occurrences and costs are rising
Traditionally, flood insurance isn’t included in homeowner insurance in Canada because only a small percentage of the population is at risk. However, the numbers of adverse weather events across the country have spiked over the last few years and flood protection is quickly becoming a priority in the insurance industry.
Last month, the Insurance Bureau of Canada’s president and CEO, Don Forgeron called for a national flood plan.
Speaking to the Economic Club of Canada in Halifax, Forgeron advocated for collaboration with federal and provincial governments to develop a coordinated response to manage increased weather risks.
Echoing his arguments, a report released last month from the parliamentary budget office predicts rising costs from natural disasters in Canada. The Disaster Financial Assistance Arrangements (DFAA) program is projected to spend $673 million a year to deal with floods and $229 million a year due to hurricanes, convective storms, and winter storms over the next five years.
The report stated the higher proportion for flood claims is partly due to the lack of privately available flood insurance in Canada, as well as problems with floodplain regulations in the Prairies, which have seen the majority of disaster costs over the last 10 years.
If you have questions or concerns about your policy coverage, it’s best to contact your insurance representative. Call us, email us, or even tweet us at isure.
isure’s guide on flood and sewer back-up: https://isure.ca/faq/whats-the-insurance-distinction-between-flood-and-sewer-back-up/