Should I pay for Water Line Insurance?

Recently the topic of Water Line Insurance has been on the minds of many of my neighbors because of the solicitations we have received in our water bills. While I was online at Nextdoor.com the following question came up:

“I received a letter from Home Emergency Insurance Solutions stating the water line buried underground on my property is my responsibility and should it rupture it would be up to me to cover the costs. They say that the water company (ETWD) would not be responsible. The homes in this area are getting older so it made me think. It only costs $65 a year but I thought I would throw it out there to see what others think? Wouldn't my homeowners insurance cover it? (I am going to call them but wanted others' opinions first). Thanks”

There was a thread going on and I had additional questions posed, so I added another reply.

1^st reply

I am an insurance agent and would caution you on homeowners' coverage. The standard homeowners policy has limitation or exclusions on water backup from the sewer system. There is an endorsement that can be purchased on your home policy to add a sub-limit for sewer backup. You should also ask about a separate endorsement for service line coverage. Each carrier may name it something different, but the coverage provides for Service Line Coverage would cover the excavation and repair of the burst water line and damaged outdoor property. The homeowner policy form would cover the resultant water damage within the home, subject to any exclusions which may apply. There are two coverage you will want to contact your agent about 1) request the cost for the service line endorsement, and 2) ask what your limit is on water and sewer backup and how much limit you can increase to at what cost.

The pipes in our area are getting older and we are seeing a lot of water damage leaks.

2^nd reply

Please research prior to purchasing. Your insurance company can endorse the coverage onto your homeowner's policy. I have attached a FAQ with one of our carriers on what is covered. The endorsement to add the coverage is roughly $30 per year with most of our carriers. Please note.... I am not replying because I want your business. I live in the neighborhood and would not want any of my neighbors taken advantage of. I am advising you to reach out to your own agent and ask them questions. Sorry the reply is long..... I think it is better to educate than be in the dark.

FAQ Related to Water Line Insurance:
Is there an age limitation on systems covered by Service Line Coverage?
-There is no age limitation on the service line – it just needs to be a covered service line under the Service Line endorsement.

What is the average claim payment for a sewer/water line claim?
-The average claim payment for SL is $4,428 with excavation being the greatest cost of a service line repair.

Is underground water piping between the main dwelling residence and an exterior barn covered?
-Yes, if the exterior barn is covered property under Coverage B (other structures) on the HO policy.

Please provide an example of a breakage loss.
-A garbage truck backing into a driveway/yard of a home causes the underground water piping of the home to collapse and/or break, resulting in a “service line failure”. Weight of equipment, animals or people is a covered cause of loss in the Service Line endorsement.

If a tree root grows around a utility line and causes a leak, would this be a covered cause of loss?
-Yes, a leak is physical damage and therefore meets the definition of a Service Line Failure

Is loss of use covered by the Service Line coverage?
-Yes. Coverage is found on page 2, Coverages, 4. Loss of Use. This is subject to the HO policy Coverage D limit.

Please provide the most common situations when coverage is denied. Where is the most customer confusion about when they thought they had coverage?

-The most common denials would be due to lack of physical damage, such as a blockage. That is not a covered accident because the pipe has not been broken.

Are natural gas and propane lines covered?
-Natural gas and propane lines are not a named “covered service line” and are therefore not covered.

Define blockage and provide a claim example to illustrate a covered versus not covered loss.
-An example is where sewage blocks the sewer line between the street and the home. If there is no service line failure to the sewer line itself, the Service Line coverage would not respond; however, if the blockage causes the pipe to crack this is a covered “service line failure” and the Service Line coverage would respond.

This information is not intended to be a complete description of coverages relating to service lines for your home. Further questions should be referred to your professional insurance agent and the policy declarations page.