Does condo insurance cover water damage?
Last updated: August 2022
According to the Insurance Information Institute (III), homeowners policies, like condo insurance, may help cover water damage caused by burst pipes, rain and ice dams. It may not cover sewer or drain backups or flooding, which would require additional coverages or policies.
Water damage that's typically covered
According to the National Association of Insurance Commissioners (NAIC), condo owners are responsible for insuring their own unit. That means if a water leak causes damage to an individual condo, it's typically the responsibility of the condo owner, not the Homeowners Association (HOA).
If you have condo insurance, however, you'll find that you're generally protected against water damage that is caused by your plumbing, your water heater or appliances, or from your heating or air conditioning systems. The cause must be accidental, however, and not the result of wear and tear. Water claims occurring over a period of weeks might not be covered if it's considered a maintenance issue.
A condo insurance policy could help cover water damage that results from a burst pipe, according to the III.
Water from Common Areas
In some instances, the water may come from the condo building — from its roof or one of the common areas you share with your neighbors. The III explains that while the HOA's master policy covers common areas (including your roof), condo insurance is meant to help cover damage that might occur inside the unit. A condo policy may help cover repairs if water leaks through the roof and into your unit.
The only way to really know what's covered is to ask for and review a copy of your condo association's master insurance policy and any condominium documents such as your association's declarations and bylaws (ideally before a problem occurs, so you can adjust your own coverage to fill in any gaps).
Water damage that's typically not covered
Whether or not condo insurance covers water damage depends on the source.
Water that comes from the ground up, like street flooding is typically not covered by standard homeowner or condo insurance, according to the III. This would require a separate flood insurance policy.
For more information on flood insurance, contact your insurance company.
Your condo insurance may help to cover damage from a water backup if you have this particular coverage on your policy, says the III. It's important to review your coverages carefully when you buy your condo insurance to make sure you have the protection you need.
Water Damage Beginning in another Unit
If you live in a community-type dwelling, you're susceptible to other sources of water damage. Like your neighbors. For instance, what if a pipe bursts in the upstairs unit and it leaks down into your own?
Condo insurance may help cover the damage if water damage stems from an adjoining unit. Your condo insurance company might reimburse you for repairs and recoup payment from the neighbor's insurer if you file a claim. Most likely, each of your insurance policies will come into play, with your insurer helping to cover damage to your property and your neighbor's insurer paying for theirs. However, if it can be proven that there was some sort of neglect that caused the damage, your insurance company might ask your neighbor's insurance company for reimbursement.
In addition, knowing what's covered under your condo association's master insurance policy can make it easier to know what to include in your condo insurance policy. It's a good idea to read through all coverage options carefully to help ensure you have the protection you need. If you're ever unsure about the specifics of your policy, don't hesitate to contact your insurance provider.