Home insurance for water damage

What kind of water damage is covered by home insurance?

Home insurance for water damage is usually split into three separate types of cover:

Flood cover is often an optional extra you may need to pay extra for – so if you live in a flood-prone area, be sure to check you're covered. Below is a table of some insurers that include water damage cover for all three services.

	Flood	Storms	Water Damage
Coles Home & Contents Insurance	Optional
Youi Building and Contents Insurance
Westpac Home and Contents Insurance
St. George Home and Contents
Real Top Home and Contents Insurance

How to make a water leak insurance claim in Australia

To file a successful claim for water damage through your home insurance, follow these steps:

What's considered water damage?

Water damage can include sudden or accidental damage as a result of water, most commonly from a burst pipe, water overflow, flood or storm.

Home insurance providers usually only cover you for sudden and accidental damage; that is, water damage that occurred quickly and unexpectedly. Gradual water damage, on the other hand, is usually not covered by most home insurance policies.

Common claims can include the following:

• Burst taps or pipes, e.g. your kitchen sink pipe bursts suddenly
• Damage caused by a storm or a flood
• Broken kitchen or bathroom appliances that cause water damage
• Sewer backup and overflow

Does home insurance cover leaking pipes?

Yes, home insurance covers leaking pipes if the damage was caused by escaping water that occurred suddenly and without warning.

A burst pipe generally comes under "escape of liquid or water" and can cover you for a sudden and immediate leak (not something gradual that you were well aware of) as a result of the following:

• Appliances, such as a washing machine, dishwasher etc
• Fixed items, such as showers, baths, sinks and toilets
• Fixed systems, such as drainage or sewage systems
• Water-filled items, such as aquariums and waterbeds

If you don't know where the leak is coming from, some home insurance providers will pay the reasonable costs up to a certain price to locate the source of the problem.

Does home insurance covers storms

Yes, standard home insurance policies generally cover storms. Storm cover can include damage caused by:

There is one main exception – home insurance doesn't usually cover damage caused by storm surges. This is because it is considered 'an action or movement of the sea', which is excluded by most home insurance providers. Luckily, it's not that common.

Frequently asked questions about water damage

• Does home insurance cover mold caused by water damage?

  Home insurance policies in Australia generally do not cover damage caused by mold mildew or fungi unless it is a direct result of an insured event. For example if a burst pipe causes water damage and mold develops quickly afterwards due to the water your policy might cover the mold remediation. However if the mold developed over a long period from a slow leak or poor ventilation it would typically be considered gradual damage and therefore excluded. Always check your Product Disclosure Statement for specific details.

• Is water damage from a hot water system burst covered?

  Water damage resulting from a sudden and unexpected burst of a hot water system is typically covered under the "escape of liquid" section of your home insurance policy. This includes damage to your home's structure and contents. However if the burst was due to gradual wear and tear or a lack of maintenance that you were aware of your claim may be denied.

• Does home insurance cover water damage from a burst pipe outside my house?

  Home insurance usually covers water damage caused by a burst pipe within the boundaries of your property up to the main connection point. If the burst pipe is on public land or part of the council's water infrastructure it is typically the responsibility of your local water authority. Check your policy for specifics regarding external pipes and boundaries as coverage can vary between insurers.

• What happens if my water damage claim is denied?

  If your water damage claim is denied you should first ask your insurer for a clear explanation of their decision and the specific policy clause they are relying on. If you disagree with their reasoning you can ask for an internal review of the decision. If you are still unsatisfied you have the right to lodge a complaint with the Australian Financial Complaints Authority AFCA which provides free and independent dispute resolution services.