Foundation repair – how home insurance will help

Foundation repair is costly - but if you're covered for the event that caused the damage, your home insurance should kick in

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When does home insurance cover foundation repair?

Foundation damage doesn't just happen by itself - something causes it. If your home insurance covers whatever caused the foundation damage, then it'll pay out for the foundation repairs too.

Your product disclosure statement (PDS) will tell you everything your policy covers. Coverage varies between different insurers but common inclusions are:

  • Fire
  • Impact (for example, a vehicle, or falling tree
  • Theft
  • Vandalism or malicious damage
  • Lightning
  • Storms and rainwater
  • Explosion
  • Escape of liquid

Depending on the insurer, the following events might also be covered. Sometimes, you may have to pay an additional fee to be covered for these incidents:

  • Earthquake or tsunami
  • Floods

When won't home insurance cover foundation repair?

If your home insurance doesn't cover the event which caused the foundation damage, then it won't pay out for the repairs. What's covered by your policy will vary between different insurers - but some common exclusions are:

  • Normal wear and tear
  • Damage to your carelessness or neglect
  • Termite damage
  • Damage caused by your illegal behaviour
  • Pre-existing damage
  • Damage from natural events that you opted not to include
  • Faulty construction
  • Storm surges
  • Tree-root damage
  • Shifting soil

How much does foundation repair cost?

The cost of fixing damaged foundations can vary depending on lots of different factors - including the extent of the damage, what caused the damage, and how easy it is to gain access to your home's foundations. However, most foundation repairs cost somewhere between $5,000 and $35,000.

Does home insurance cover cracked walls?

Your home insurance may cover the cost of repairing cracked walls, if the cracks were caused by an event that you are insured for.

For example, if a broken pipe caused flooding, which ultimately lead to cracks in the walls, your home insurance would likely cover the cost of repairs. However, if the cracks were due to drought or moving soil, it's unlikely you would be covered.

Is restumping covered by home insurance?

Usually, houses need restumping due to age, termite damage, or soil movement. In those cases, it's unlikely your home insurance will cover the cost.

However, if the stumps have been damaged by an insured event - for example, a pipe burst and caused significant water damage - you might be covered for restumping costs.

Is underpinning covered by insurance?

Underpinning can strengthen the foundation of your house and prevent further damage down the line. It's a great idea and can make your home studier for many years to come. Unfortunately, underpinning is not usually covered by home insurance.

Does home insurance cover structural problems?

Typically, home insurance does not cover structural problems. It's also unlikely that your home insurance will cover any defects in design, materials, workmanship or construction.

Does building insurance cover subsidence?

If the subsidence was caused by an event covered in your home insurance policy, then you'll probably be covered for the cost of repairs. For example, if a severe storm and heavy rain causes subsidence, your home insurance should pay out.

However, if the subsidence is caused by poor workmanship or nearby construction, it's unlikely you'll be covered by your home insurance.

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