Insurance coverage for drain back-ups
Of course no one wants to over pay for homeowners insurance. It can be tempting to trim extras or switch to a cheaper insurance company to save some money. When evaluating a policy, many homeowners overlook the drain back-up coverage, until they have a problem!
Not all Insurance policies cover drain back-ups. Many policies will include ryder coverage for drain back-ups in increments of $5,000. Check your policy! When there is 6 inches of dirty water in your basement, it is the wrong time to find out you're not covered. Remember, not only does the coverage have to be appropriate for the replacement costs for mechanicals and wall materials, etc, but it also has to cover the clean-up and mitigation as well. Here are some rules of thumb for insurance coverage needs for drain back-ups:
$5,000 worth of coverage - Unfinished basement with no drywall or stud framing. No carpet, no pad...just major mechanicals like furnace and hot water heater. No furniture or contents. In a dramatic back-up where there is 6 inches or more of water, this coverage will typically only replace the furnace and hot water tank. This type of coverage leaves no room for clean-up or mitigation if the mechanicals are affected, so guess who has to either pay out of pocket for the difference (or do the cleaning)? The homeowner! If you are unable to clean-up after a drain back-up due to health issues or old age, then any assistance can be costly. These costs can cause delays in clean-up, which can lead to mold and bacterial issues.
$10,000 - Semi-finished basement. Some wall materials. Some contents, some furniture. Typical mechanicals like furnace and hot water heater. This type of coverage gets used up very quickly in a dramatic back-up event. Mitigation and clean-up can account for several thousand dollars. Major mechanicals can account for the next $5,000, leaving not a lot to replace drywall, contents and furniture or a washer and a dryer. This may seem like plenty of coverage, but it goes quickly. In a dramatic back-up, it can be quite insufficient in even semi-finished basement.
$15,000+ Depending on size of basement and its contents!!! Fully finished basement with finished walls and carpet/pad throughout. Typical mechanicals, furniture and contents
It pays to understand the replacement value of the contents, furniture, wall materials and mechanicals in you're basement when evaluating the drain back-up coverage in your homeowners policy. Add in additional coverage for typical mitigation costs (possibly over $5,000 for a large basement) to arrive at the appropriate back-up coverage that will be sufficient for a dramatic back-up event.