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What Happens With Sewer Back-Up: Your Insurance Coverage

March 26, 2012

Water damage is one of those areas of home insurance where there are plenty of exclusions and grey areas, and homeowners can often be unclear on what is covered and what is not. Some types of water damage are covered under a standard homeowner’s insurance policy, while others require that you add an optional coverage in order to receive benefits. Sewer back-up falls into the latter category. You can receive coverage for sewer back-up in your home but you may have to add an endorsement to your policy and pay an extra premium for the coverage.

What is Sewer Back-Up?

Sewer back-up occurs when the city or municipal drainage system overflows and sends water back through the pipes and into your home. This may happen for a variety of reasons, but the most common is a great deal of water from rainfall or snow melt overwhelming the system. It can also be a result of a failure on the part of a sump pump or other system designed to deal with excess water. The water and sewage can come from various sources including a septic tank, sewer or storm drain.

Sewer back-up can result in a great deal of damage to homes, including the development of mold problems and of course bacteria from sewage that has entered the home. It requires immediate proper clean-up that can be very expensive as well as can result in damage to carpets, walls, furniture and other personal property that will be costly to replace.

Sewer Back-Up Coverage

Sewer back-up coverage is available to most homeowners as an optional coverage that can be added to a standard homeowner’s policy. Some areas are more likely to need this optional coverage as they are located in places more prone to flooding and sewer back-up. These areas are those most likely to have this optional coverage offered to homeowners.

Without this coverage added to your policy, you could discover that you have little to no coverage available in the event of a serious flood or even a local problem that results in a sewer back-up. Without the coverage, the cost of repairs can easily reach into the tens of thousands, and for the average homeowner this is an amount not readily available. The cost of adding the coverage to your policy is minimal in comparison to this and is a wise decision especially if you live in a location where sewer back-up is an issue. This coverage is optional, but in some cases your mortgage company may require that you carry it if you live in a high-risk area.

Shopping around for your home insurance is the best way to make sure that you have all of the coverage you need, including sewer back-up, at the best rate. Rates may differ widely from company to company, and you may discover you can pay the same or less for a policy that includes sewer back-up from one company than you would for a policy without the coverage elsewhere.

Avoiding Sewer Back-Up

Prevention is always better than dealing with damage even if you do have the coverage in place to pay the claim. There are several things you can do to prevent sewer back-up from destroying your home and property:

  • Install sump pumps and check regularly to ensure they are in good working order
  • Have backflow valves installed in your home
  • Ensure that your property has good drainage – a slope that moves away from your home is best
  • Have plugs ready for all drains and toilets
  • Keep all of your eaves troughs and downspouts clean and clear to allow proper drainage

In some cases, especially extreme ones, back-up might not be preventable, but the damage can at the very least be minimized with these precautions.

A surprising number of homeowners are not aware that sewer back-up is not a standard part of a homeowner’s insurance policy. It’s vital that you verify whether or not you have coverage right away, before finding out you do not have it when your home is filled with sewer water. You should also find out whether or not you live in a high-risk area, making this coverage even more vital. If you don’t have this coverage on your policy, shop around for a policy that does include it and compare it to adding the coverage to your current policy. The cost of an optional coverage is low when it comes to your peace of mind.

  • Bea Weekes

    is sewer back-up insurance necessary when living in an apartment?
    What coverage is absolutely necessary when living in an apartment?
    Thanks!
    b

  • Nick – InsuranceHotline.com

    Hello,

    Sewer back-up is not necessary when living in an apartment (or a home) it is an option for you to add on if you like. Depending on what floor you are on, it may not make sense for you to take, for example, if you are on the first floor or in a basement apartment, you may want to consider sewer back-up, but if you are on higher level floors, it doesn’t make sense to have sewer back-up as you are not on the sewer levels. The only necessary coverage you will need when obtaining tenant insurance are liabilty and content insurance.

    Hope this helps.

  • Linda

    Why does an insurance company charge sewer back-up, when I am not on Municipal Sewers?
    I live in the country, and have a septic system. Last year my “Back-up” insurance was $595.00
    Can you explain.

  • Nick – InsuranceHotline.com

    Hello,

    Since each insurance company has their own rules and rates, you are best to discuss your policy with your insurance professional. Let your insurance company know that you may not require this coverage. With some insurance companies, this coverage is optional.

  • Alyssa

    Hi,
    I’m renting a house in QLD, and the neighborhood’s sewer backed up into my laundry and garage, leaving me with no choice but throwing away everything that was there as it was all coated in raw sewage.. the RTA claims that I am not insured as I don’t have my own Home and Contents Insurance but there must be a way for me to get some form of compensation, seeing as the sewer blockage wasn’t even my fault. I lost 2 whole wheelie bin’s worth of items, many which obviously have sentimental value.
    I am not sure what I can do as no one seems to know the answer- someone please help! :(

  • Nick – InsuranceHotline.com

    Hi Alyssa,

    Unfortunately, we do not have any information on insurance in Australia.

  • Lynn

    State Farm here in Canada changed their sewer backup coverage to $5000.00 deductible last year. It used to be your regular content deductible amount. Dam!!

  • jimmie

    Hi there, we just built a new home with a septic tank built and installed by a professional, a premium for sewer backup is 51 per annum and since i have a new system that is lower than the house and installed professionaly i am not taking the coverage which incidentally is 1000 deductable….comments please….

  • naren

    how much the coverage amount should be? Some companies are offering with 300,000 $ while standard says around 25,000 – 50,000.
    Do we really need 300,000?

  • http://www.insurancehotline.com/ InsuranceHotline.com

    Hello Naren,

    I’m not sure what coverage you are referring to… could you please specify?

  • Mdow

    If our basement doesn’t have a floor drain or sump pump and we are on municipal sewer and water, is it possible to have a sewer back up to our main floor bathroom? Just want to see if it is worth putting in a sump pump or not, thanks!

  • sri

    Hi
    I had a sewage back. up problem few weeks ago and my insurance coverage only $25000. it is included my lost and clean up. Cleaning company claim $12000 and I am getting only $13000 for my loss. my loss was around $25000. Can I claim rest of the money from city???

  • ron

    hi there , we have above ground basement style home. my lowest floor level is about 3 feet above street level so basically sewer will backup onto street and fill street 3 feet before it gets to my floor level. should I worry about getting sewer backup coverage ? by the way we are on highest level of city where my window seem to be level to tallest building of downtown about 5km away.

  • Marcella Gurnow

    I live in Warren Michigan. We don’t have flood here but for some reason last summer the south east metro Detroit area flooded, express ways and all. AAA is offering sewer, drain back up coverage H-95 $40.00 per year but only $5000. coverage. Seems like a lot of money for a very little coverage? Includes limited property damage.

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  • Jeremy

    A common misconception with newer homes is that you will not have to worry about having any claims. Unfortunately, this is not necessarily the case. For instance, what if over the course of the first few winters, the pipes leading to septic tank crack or get clogged another way?
    Another area not discussed in the above article is that sewer back-up endorsements will also cover failure of your gutters, weeping tiles or ice damming as well as just sewer water. Each insurance company’s policy will vary as to what exactly is covered, so it’s best to check with your agent or broker to find out what yours would be.
    In the end, it’s up to you, and I understand everyone wants to pay as little as possible for their insurance, but water claims are the #1 cause of claims on home insurance policies and Sewer Backup related claims account for more than half of those ,so even if you have a new house it’s worthwhile peace of mind to have.

  • Jeremy

    Hi Ron,
    This is a common question I get as an insurance professional. I can say that absolutely YES, the coverage is still worth it for you. Sewer backup claims can relate to any drainage issues in your house. For instance, if your dishwasher gets clogged and spills out into your kitchen your insurance company could classify this as sewer backup claim. Half of all water related claims are filed under sewer backup.
    It may be worthwhile to ask your broker what your insurance company covers under this endorsement that you may not have considered such as Ice damming, or failure of your eaves troughs or downspouts.

  • Jeremy

    Situations like yours are one of the reasons it’s worthwhile to really look at the coverage you are getting for your money. Because of the high value of Sewer Back Up claims, insurance companies have started reducing the available coverage and increasing the deductibles for this endorsement, leaving unsuspecting people like yourself with not as much coverage as they expected.
    You can sometimes try and go after the city for extra damages, but based on my experience in the insurance industry, it is very rare that you will have much luck.
    Hopefully your case was an exception.

  • Jeremy

    If the city sewer system fills up, the water will go to the path of least resistance. If you have nowhere for the water to go into the basement and there is enough pressure for it to rise up the pipes, then you always have the possibility that the water could make it to the main level. Any protective measures you can take such as a sump pump or a backflow valve are always worthwhile investments.

  • Betty

    Is a Sewer Back-Up insurance required for a condo bldg. ? I live in a condo – 10th floor and my insurance is suggesting that I get it or else I may not be cover in case of water damage in my unit.

  • InsuranceHotline

    It’s your decision but in the event that there is a sewer back up or some other water damage it’s always better to have it an not need it than need it and not have it.

  • Sonia Thayer

    I rent. One year ago City put in new pipe and unknown to all damaged my pipe to street so buildup of sewage caused mold and all my personal property besides landlord basement walls and floor gone.
    City won’t admit they caused it but has taken charge of landlords cost to replace all his damage and willing to discuss my personal loss bickering all the way. My question, can my landlord sign off with out me signing off or do we both have to sign off together for it to be a done deal. In other words, if I don’t settle would it effect my landlord?

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