Does home insurance cover water damage?
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Samantha Kohn, Freelance Blogger
This article was originally published on February 9, 2023 and was updated on June 13, 2025.
Water damage caused by leaks or floods is one of the worst situations a homeowner can face. There are so many ways for water to get into the home, and once it’s there, the damage it can cause can be extensive.
The average cost of repairing a flooded basement in Canada is more than $40,000. That’s why it’s essential to have a home insurance policy that offers protection against flooding. This is especially true as severe weather events like heavy rainfall continue to impact households (and insurance premiums) across the country.
The issue, however, is that many homeowners don’t know whether they have coverage or enough of it to be protected. A new home insurance survey conducted by Ratehub.ca found that over a third of respondents were either unsure about exclusions in their policy that could affect coverage for events like floods, or had never checked them.
So, does home insurance cover water damage? Let’s break it down.
Key takeaways
- Coverage for water damage depends on your policy terms and the cause.Â
- Flood insurance is typically not included in a standard policy unless you add coverage for overland water (freshwater flood) and sewer backup (sewage flood).
- Many home insurance policies include water damage coverage for sudden and accidental events, such as a burst pipe or an appliance leak.
- If the water damage is caused by negligence, your insurer will likely deny the claim.
Does home insurance cover water damage?
The Insurance Bureau of Canada defines a flood as when bodies of fresh water, such as rivers or dams, overflow onto dry land. Water damage to a home can be caused by anything from a leaky appliance to a cracked foundation, a blocked drain or gutter, or a burst or frozen pipe.
Even a small amount of water can soak your drywall and flooring, causing mold to grow and requiring extensive restoration to remove it. It can also damage the electrical system, create a smell that lingers for years, and even cause structural damage to your home.
Most homeowners carry insurance to cover major damages to the interior and exterior of their homes. While home insurance is something every homeowner should have, the level of protection depends on the coverage you select.
Does home insurance cover water damage from floods?
The answer to this question depends on two main factors: the cause of the water damage and the add-ons selected as part of the home insurance policy.
In Canada, homeowners can choose between three types of policies: basic, broad and comprehensive. While the latter offers the highest level of standard coverage, it excludes certain risks, including water damage.
Also read: Broad vs. comprehensive home insurance – what you need to know
Instead, policyholders must choose to add on optional flood insurance endorsements to their policy. There are three common types of water damage coverage: overland flood coverage, sewer backup coverage and storm surge coverage.
By including any of these add-ons to your policy, you are purchasing extra protection that is well worth the money if your home is ever damaged by water.
Does home insurance cover water damage from leaks?
In most cases, the answer to this question depends on whether the leak was sudden and unexpected or if the water was leaking gradually over time.
Home insurance policies will cover water damage caused by a ‘sudden and accidental event,’ like when a plumbing or appliance pipe bursts. For example, if the pipe in your washing machine bursts in the middle of a load, and the water from that pipe causes damage to your home, that damage will most likely be covered.
However, the situation is different if your pipe is leaking slowly, releasing small amounts of water over time. In that case, having the damage covered will be more difficult because the insurance provider might consider you negligent for not having the appliance repaired before it was too late.
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What are the types of water damage that home insurance won’t cover?
As mentioned above, most insurance policies will not cover water damage that occurs because of negligence. Home insurance providers often do not cover water damage that could easily be avoided by proper home maintenance.
This includes:
- Damage caused by a dripping ceiling
- Damage caused by ignoring a plumbing problem
- Damage caused by burst pipes that froze because the home was not properly heated in winter
- Damage that was left to continually worsen because nobody was there to stop it from progressing.
One factor that can complicate water damage coverage is the timeframe between when the damage occurred and when it was reported to the insurance company. The longer it takes to clean up the original mess, the more significant the damage, and the more expensive the repairs.
A significant lapse between the occurrence of damage and its being reported indicates that nobody was home to notice the water. While the details and timeframes differ, most home insurance policies are specific about how long a home can remain vacant before water damage coverage becomes void.
Also read: What is vacant home insurance?
For example, many snowbirds who leave their homes in cold climates to spend the winters in warm locations must agree to have their homes inspected by a trusted source at regular intervals. This ensures that if water damage occurs, it will be discovered and addressed immediately.
If this is part of their policy and water damage does occur, the homeowner will need to provide their insurance provider with proof that the house was inspected within the agreed-upon timeframe. If this applies to you, it’s a good idea to leave out a calendar and have the person inspecting your home sign every date they show up to check things out.
Also read: What doesn’t home insurance cover?
The bottom line
Every home insurance policy differs when it comes to water damage.
When selecting coverage, be sure you know exactly what it covers regarding flooding and abide by the requirements set out in your policy. Ask about any add-ons that offer coverage for damage caused by common events such as flooding and sewer backups.
Take proper care of your home and never assume that a minor plumbing leak can be ignored. Ignoring a small problem will allow it to develop into a major issue that your homeowner’s insurance policy may not cover.
If you’re unsure about your coverage, review your policy and speak to your insurance broker. You might also consider shopping around for home insurance quotes to find affordable coverage that includes flood insurance. Don’t wait until it’s too late!