Why Do Insurance Companies Deny Water Damage Claims? Find Out Here

Table of Contents

1. Why Do Insurance Companies Deny Water Damage Claims?[+]
   1. The Cause of the Damage Was Contained Within The Home
   2. There Is No Evidence Of A Leak Or Flooding
   3. There Is Little Or No Damage To The Area Around The Leak/Flood Site
   4. You Were Responsible For The Water Damage
   5. It Was A Prior Condition That Is Now Re-Appearing
   6. There Is A Lack Of Necessary Documentation
   7. You Don’t Have Additional Coverage That Includes Flooding Or Leakage Coverage
   8. The Insurance Company Reimbursed You For Your Loss And Are Now Paying Out On A Claim

Do you have an insurance policy? If so, do you know what to do in case of a water damage claim?

Water damage caused by floods, sewer overflows, burst pipes, or other natural disasters can cause extensive repairs that cost thousands of dollars.

You may be trying to save money for your family and the last thing that you want is to be denied payment by your insurance company.

The hardest part about filing a claim is dealing with an insurance company that knows all the ins and outs on how not to pay out claims. There are ways to get around this problem though.

This article will detail why insurance companies deny claims for water damage restoration and answer important questions such as: “What does my insurance cover?”, “What should I do when my home sustains water damage?”, “Who can I call for help if it happens to me?”, and much more.

Why Do Insurance Companies Deny Water Damage Claims?

Read further to know the key reasons why Insurance companies deny water damage claims.

The Cause of the Damage Was Contained Within The Home

A standard homeowners policy typically excludes coverage for water damage claims unless external factors cause the damage, such as flooding or an overflowing sewer pipe.

If you need to file a claim for water damage restoration caused by broken pipes within your home, be sure to get extra insurance coverage beyond your usual policy so that you will have protection down the road in future disasters.

It isn’t only during internally originating damages when insurance companies won’t pay for water damage claims. Some companies may cite that there are no records of any prior flooding or leaks on your property or nearby.

An insurance company could deny a claim if they do not find any records of any flooding or leakage problems on your property or nearby premises.

When filing a claim for water restoration, be sure to check with your local city hall as well as the local building department as records could be available.

There Is No Evidence Of A Leak Or Flooding

If you have a water damage restoration claim and there is no evidence of a burst pipe, leaky toilet, or flooding, your insurance company could deny the claim.

According to the Insurance Information Institute, if an insurance adjuster does not see any visible sign of a flood or leakage on the walls, ceiling tiles, or flooring, then they will likely deny the claim by saying that the cause of the damage was from inside your home instead of from outside.

There Is Little Or No Damage To The Area Around The Leak/Flood Site

Without any actual proof aside from photographs and videos as well as quotes from professional inspectors and contractors indicating extensive repairs due to water damage, an insurance office may refuse to pay your claims for home water damage restoration.

You Were Responsible For The Water Damage

When an insurance adjuster has doubts about the cause of the water damage they will investigate further to determine whether you caused the problem yourself.

For instance, if you have a dishwasher that flooded your kitchen due to improper installation or a faulty valve, insurance companies can deny your claim citing irresponsible activity as a reason for denial of claims related to water damage restoration.

Insurance companies would point out that as a homeowner, you are responsible for maintaining the plumbing system and repairing damages.

They would see it as negligence on your part if worsening water leak damage caused the water damage.

It Was A Prior Condition That Is Now Re-Appearing

If there were problems with your home’s foundation or roofing and it is now re-occurring after possible repairs were made, then this could be another reason why an insurance company denies a claim.

Again, the insurance company will point out negligence as a reason for the claim denial.

It could either be on your part as a homeowner for not ensuring that the materials used are high-quality and for not checking the quality of the finished project.

If a contractor performed the repair, they may share liability for negligence and become the responsible party who will pay for the resulting water damage.

There Is A Lack Of Necessary Documentation

If you have photographs, videos, and quotes from professionals but fail to provide them upon request then your claim will likely be denied.

The same goes for the lack of documentation about any prior damage or repairs to your home or business premises.

Another reason why water damage restoration claims are denied is because there is no proof that a professional contractor repaired previous damage in the past.

You Don’t Have Additional Coverage That Includes Flooding Or Leakage Coverage

This is one of the most common reasons why your water damage claim is denied.

If you need to file a claim for water damage restoration and you do not have additional coverage such as flood insurance, your application will likely be denied by the underwriters because there is no coverage for this type of loss.

If you find yourself in this situation, we highly recommend checking out the Federal Emergency Management Agency (FEMA) website.

This program provides affordable coverage that is available in every state regardless of your level of income.

Now is the time to review your home insurance policy and check the coverage limits and conditions to see if it covers these types of damages.

The Insurance Company Reimbursed You For Your Loss And Are Now Paying Out On A Claim

If you have received insurance money or a check from the insurance company for any type of damage to your property, they will typically deny any claims for water damage restoration when filing within the designated time frame.

They are worried about fraudulent activity and the impact on their profits if they pay out on another claim too often, which would cause everyone’s premiums to go up.

Insurance policies may come with some restrictions when it comes time to file a claim for water damage.

It’s important to be aware of these limitations both before and after a loss occurs to maintain a constructive working relationship with your insurance company.

On the whole, the best way to handle this situation is by being proactive and contacting your agent as soon as you notice any type of water damage in or around your home or business.

Thank you for reading!