How to Avoid Claim Denials for Water Damage

7/5/2019 (Permalink)

Asking your insurance adjuster if you're more likely to be approved or denied when they're on-site is an opportunity to get answers to concerns.

Home insurance claims stemming from water damage are among the most frequent of insurance claims around. We will cover water damage types, what damage is covered and what claims are typically made by homeowners. We will also cover why home insurance companies deny certain claims and how to avoid these denials.

Types of Water Damage

There are many kinds of water damage. Different homeowner’s insurance policies will cover different types of damages and situations. Some of the more common sorts of water damage that will show up on a policy as either covered or excluded from coverage include:

• Water damage caused by heavy storms

• Flood damage

• Water backup or sewer backup

• Accidental or sudden discharge

• Overflow

Home Insurance Claims for Water Damage

Homeowners usually want to know what sorts of water damage will be covered by their policies. Common types of water damage inquiries are for leaks, such as from leaky roofs, toilets or pipes around the house that distribute water. Coverage for water damages will be determined by the damage’s origin, the policy that the homeowner signed up for and if the claimed damage is both sudden and accidental or if the damage was gradual.

Gradual Damage

Gradual damage is water damage deemed to occur slowly over a long period of time. Some forms of gradual damage will be hard to spot until it is too late, such as when the damage is occurring within the interior walls of a home. Though these sorts of issues can lead to structural damage down the road, most of these damage claims would be denied since they didn’t occur both accidentally and suddenly.

Homeowners frequently make claims ultimately caused by gradual damage such as the following:

• Leaky pipes, plumbing, and faucets damaging walls, floors, and ceilings.

• Watering seeping in from foundation weaknesses or from holes around the home’s exterior.

• Worn down tiles, flashing or other roofing materials that are allowing water to enter the home.

• Damage due to corroded, moldy or rotting materials.

• Electrical wiring that has become worn and less effective.

• Sub-standard home repairs or non-repairs.

Though not always, insurance companies may cover the “resulting damage” of issues or parts that originally wouldn’t have been covered by the present policy.

If a homeowner wants to know the finer details of what is covered and not covered in their policies, then it’s best to consult the insurance company or their insurance broker or advisor. They can go over the exclusions and details of a homeowner’s insurance policy for complete coverage details.

Reasons that Claims can be Denied

Homeowner’s insurance claims can be denied for a variety of reasons. Gradual damage, coverage lapses or miscommunications are just a few reasons for claim denials. No matter the reason, the homeowner should request a complete explanation of why the claim is not being granted. This includes an elaboration of which part of the wording within the policy doesn’t apply to what the homeowner is seeking compensation for.

Keep in mind that many people represent the home insurance organization during the claims process, so it’s a good idea to determine from whom the denial is coming from. Was it the contractor, an insurance agent or a claims adjuster? Each person has a different role within the organization, opening different paths for reviewing or negotiating through the process.

One reason for the claim being denied was that it was for an issue that the homeowner had to specifically request or endorse beforehand. It’s one of the homeowner’s rights to know what conditions were covered on their policies for present and future reference, including the optional endorsements and features.