By Matt Yost

Have you ever found yourself puzzled by water damage in your building, wondering what's covered and what's not under your commercial property insurance policy? Water damage claims can indeed be complex and frustrating to navigate, but let's break it down together and shed some light on what's included and what's excluded when it comes to water damage coverage.

Let's jump right into the essentials:‍

Understanding Coverage Exclusions:

Standard property policies typically exclude water damage resulting from floods, mudslides, water backup from sewers, drains, or sump pumps, and water seepage through foundation or basement walls.

Options for Additional Coverage:

• Flood Insurance: This coverage protects against overflow of inland or tidal waters, mudslides, or rapid accumulation/runoff of surface water. It's crucial for areas prone to flooding and readily available in approved flood zones.
• Backup of Sewer and Drain Coverage: Endorsing this coverage on your property policy safeguards against water backup through drains, storm sewers, or sump lines. Most insurance carriers offer this option willingly.

Determining Insurability Based on Water Source:

• Water flowing from the bottom up is typically not covered unless specifically added to the policy.
• Water damage from the top down (e.g., roof leaks or burst pipes) is typically covered under standard property policies.

It's essential to educate yourself about your policy's coverage provisions to understand whether your water damage claims are covered. Remember, the source of the water is a crucial factor in determining coverage eligibility.

If you're uncertain about your policy's coverage or need a comprehensive review, don't hesitate to reach out to us at the Hummel Group. We're here to assess your risk and provide guidance on available options, so you can ensure your business is adequately protected against potential losses.

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