Educational Corner

Most homeowners and renters know they need to have insurance coverage.  Unfortunately, most don’t know what their policy covers or doesn’t cover as is usually the case.  From drainage issues to mold to who is responsible for the extra utility bills during the loss, many insured people don’t know about several relatively major. 

Sump Pump and Drain Backups
When it comes to sump pumps and drain backups, coverage for these issues is nearly always a separate endorsement on the policy.  The endorsement is to cover any loss due to sump pump failure or backup from a drain of any kind. This type of coverage goes up to a cap, usually $5k, $10k, $15k, or $25k.  Occasionally you can find higher caps, but most insurance companies don’t offer more than $25k. This cap is the maximum amount available for both mitigation and repairs. Any amount over the cap becomes the homeowner’s responsibility.  It’s extremely important to discuss this endorsement with your agent to understand the give and take of extra premiums versus the safety of the extra coverage. It’s usually best to go with the highest coverage offered if it’s possible for your budget.    

Mold
Most people are not aware mold coverage is not standard on a homeowner’s insurance policy.  Many insurance companies don’t offer mold coverage even as a separate endorsement. Like sump pump coverage, mold is covered up to a cap when it is covered at all.  Because mold remediation can be extremely costly, it’s best to go with the highest coverage endorsement your insurance offers, if available.  

Collectibles and Hobbies
Coverage of collectibles and hobby items can be very company-specific and very dependent upon the value of the items. It’s important to ask your insurance agent about the company’s policies.  Most companies require a separate endorsement for collectibles, although the definition of collectible can vary greatly from company to company. These endorsements are especially important if your collectibles are worth far greater than face value. If the endorsement isn’t purchased, typically the company will only cover the face value of an item.  This limitation means that if you have a comic book with a market value of $150.00, but a face value of $0.10, you’ll only get $0.10 for the comic in the event of a loss if you don’t have a collectibles endorsement on your policy.  

Utilities During a Loss
When a loss occurs in a home, utility bills typically increase.  This increase could be anything from a higher water bill due to running water from a pipe break to higher electric bills from equipment usage during mitigation and restoration.  It’s important to know that the insurance company of the responsible party usually will pay for these increased bills. That means if a renter is responsible in a rental, the renter’s insurance should pay for the increase.  Likewise, if the property owner is responsible, whether in a renting or owner situation, their policy should cover it. The most common way for an insurance company to determine the amount to be paid is to take the last two-to-three months of bills before the loss and average them to determine the amount owed.  

Renter’s Insurance 
Many renters aren’t even aware they need coverage, let alone what the policy covers.  A rental policy largely only covers the contents of the home – your “stuff.” Other coverage could include food and housing if the loss is such that the home isn’t habitable. Utilities may also fall under the policy if those bills are the responsibility of the renter.  When it comes to food, though, it’s important to always keep the receipts for what you spent. The insurance policy usually will not cover food upfront but will handle it as a reimbursement instead. 

Insurance policies can be tricky and intricate. It can be difficult to know what’s covered both when purchasing the policy and in the event of a loss. Talk to your agent about all the situations that may arise in your home to cover all contingencies.  Know what the different limits and caps are for your policy, so you’re prepared in the event of a loss.  

 

Do you know about your sump pump and its importance in your home? And do you know if you’re covered by your insurance if you run into issues with your sump pump?

If you live in a home that is on any foundation other than a slab, you should have at least one sump pump and possibly more depending on the size of the home and various other environmental factors. Even with a sump pump, it’s important to know how it works and the different issues you might encounter.  
            

How It Works

The first thing to know about your sump pump is how it works. When a home is built, a drainage system is created around the foundation to filter water down to the drain tiles which then drain into the sump pump. The entire purpose of your sump pump is to keep water away from your foundation so it doesn’t seep into your home. After the water drains into the pump it is pushed as far away from the foundation as possible, usually towards the street, the middle of the yard, or a drainage ditch. When there is too much water at once, the drain tiles can fill, and the sump pump may not be able to work fast enough to continue pumping out the water, causing the pump to overflow. This means that even if the sump pump is working properly, it’s still possible to have a water loss in your home due to a sump pump backup.
 

Different Problems

       · Burnout Due to Overuse

There are multiple ways a sump pump can experience overuse. The first thing to consider is the age of the sump pump. If the date on the pump says replace it, then it must be replaced even if it’s been working properly. The next storm might be the one that causes it to fail. Living on a high-water table can also cause burnout. Because there is often water near the foundation, the sump pump must constantly be working overtime. Finally, anything that causes excess water near the foundation will put the pump in overdrive. This could be anything from extensive rains, to poor landscaping, to an above ground pool breaking and flooding the yard.

       · Power Outage

Put simply, if there’s no power, there’s no pump. The last thing you want when the power goes out in the middle of a torrential storm is to worry about your basement flooding. In an ideal situation, the home would have a whole house generator to ensure the sump pump continues running in the event of a power outage. Because this isn’t a perfect world, it’s highly recommended to have a battery backup for your sump pump, assuming you don’t have a generator. It’s best to get a battery that has a two- to four-hour life as most outages are resolved in that time frame.

       · Underuse

Although it may seem counterintuitive, underuse of a sump pump can also cause issues. The sump pump detects water levels much the same way that a toilet does. There is a float that sits in the pump pit and rises as the water rises. Once the float gets to a certain point, the sump pump activates. Sometimes, when the pump has not been used in a long time or at all, the float will get stuck, so the pump never activates even though the water is rising. The easiest way to prevent this from happening is to look at your sump pump once a month and make sure the float is working. This can be done by manually lifting the float until you hear the pump go off or by simply pouring water into the sump pump pit until the float rises enough to activate the pump.
 

Know Your Policy

SUMP PUMP COVERAGE IS NOT TYPICALLY STANDARD IN HOMEOWNER POLICIES. This is so important, and so many homeowners are unaware of it that it bears repeating – sump pump coverage is not usually standard coverage. If you live in a house that is on a crawlspace or a basement, check your policy and talk to your agent. Most insurance companies have a separate endorsement that must be added to your policy for sump pump backups and other drainage issues to be covered. It is highly recommended to make the small investment into extra premiums to have the highest coverage your budget will allow. It can be the difference between having your finished basement restored at the cost of only your deductible or 100% out of pocket which can run in the tens of thousands of dollars.

When Appliances Attack

The washing machine is leaking! The dishwasher has overflowed! The icemaker is spewing water across the kitchen! Walking into your home or business to see water covering the floor can be a truly horrific experience, but it doesn’t have to be.  Knowing what to do, what you can take care of yourself, and when to call a professional can ease your worries and help keep panic at bay.

First Steps
 

•The very first thing that needs to be done is stop the flow of water.  This usually means determining the source of the water and either turning off the source itself or cutting off the water flow at a nearby shutoff valve or at the water main.  At this point, unless you’re a very good handyman, a plumber needs to be called. Mitigation can’t begin until the water has been stopped.  
 

•There are a few things that can be done immediately to lessen the damage to the structure.  The first is to extract as much water as possible as quickly as possible. The faster the standing water is removed, the less time it has to cause damage.  Extraction can be done any number of ways, including using towels, shop vacs, and carpet cleaners. The next step is to remove as much content as possible from the affected area.  This includes furniture, knick-knacks, and anything else that’s not attached or nailed down. After extracting the water and clearing the area, it can be helpful to set fans if they’re available.  

Professional Help 
 

•With any kind of water damage, it’s important to call an IICRC certified professional to come in and scope the loss right away.  Water is tricky. Because it’s not possible to see inside wall cavities and under layers of floor, it’s necessary to have a professional take a look and properly assess the damage.  

•At this point, the restoration professional will ask a series of questions to get an idea of the loss.  This will include finding out if the source of the water has been determined and fixed or turned off, what you’ve done to start cleaning up, what type of materials have been affected, how far the water traveled, what type of foundation you have, and how much content there is. 
 

•An appointment will be scheduled for a project manager or certified technician to do an initial scope to assess the damage to the property.  They will be able to work directly with you or with your insurance company to come up with a solution and plan of action to restore the property to its pre-loss state.  

Frequent Concerns
 

•Mold: With perfect conditions, it takes 24-48 hours for mold to begin growing and 72 hours for it to colonize.  This means that as long as professional mitigation starts within 24 hours of the loss, mold growth can be prevented.  Going past those 24 hours does not guarantee you will experience mold growth, but it does increase the risk. Setting personal fans to begin the drying process can also be helpful in preventing mold growth because mold needs stagnant moisture to grow.  
 

•Time Frame: It typically takes 3-5 days to complete the drying process depending on the materials that were wet.  The entire job, including drying, demo, and cleaning usually takes 5-7 days to complete. Bear in mind that this does not include the time it will take to put everything back.  Staying in the home while mitigation takes place is largely dependent on the size and type of loss. Most insurance companies consider a home to be “habitable” if there is access to a kitchen and a bathroom, although it’s necessary to check your policy for specifics.  

•Pets:  It’s best to keep all pets away during mitigation because the air is so hot and dry.  Fish tanks and exotic pets such as birds and reptiles must be removed to unaffected areas of the home or removed from the home completely if there are no unaffected areas.  

Experiencing a water damage in your home or business can be stressful and scary.  Being confident that you know the appropriate actions to take to reduce the extent of the damage is the first step to easing your mind.