In 2018, the cost to the insurance industry for weather-related claims was a staggering $1.9 billion. In 2019, severe weather costs topped $1.3 billion with last year’s flooding in Eastern Canada alone, causing nearly $208 million in insured damage. If it seems to you that the cost and intensity of natural disasters in Canada are on the rise, you’d be right, as both 2018 and 2019 were among the costliest on record. That can have a significant impact on your home insurance.
The annual spring melt-off is a common cause of flooding in Canada. As melting snow forces rivers and streams to swell and overflow their banks, the resulting floods can cause hundreds of millions of dollars in damage to homes in low-lying areas.
As noted in a recent University of Waterloo study, many waterways are already at higher-than-normal levels due to the impact of climate change. That means there is a greater potential for even more catastrophic flooding in the coming years.
Is Your Insurance Up to the Task?
You may be surprised to learn that your home insurance policy probably doesn’t cover flooding. That’s because basic policies only pay to repair the damage caused by water, and only when the water doesn’t come from an outside source.
Confused? That’s understandable, but here’s how your insurance provider looks at it.
If a storm or falling tree limb damage your roof, for instance, your insurance will cover the costs to repair the roof. If rain manages to work its way into your home before the repair is completed, your insurance will also take care of the water-related damage. However, water from floods or a backed-up sewer are considered to originate from an outside water source and are not included in a standard home insurance policy.
This distinction between inside water and outside water is important. Unless you add specific flood insurance to your existing policy, you may, in a manner of speaking, be left high and dry by your insurance company.
On that note, it’s also essential to document the value of the contents in your home. Contents coverage is included in most home insurance policies, but be sure to read your policy and understand what you have coverage for and what you may need to add.
What Types of Flood Insurance Are There?
To protect your home from flood water damage, you should consider adding overland flood insurance to your policy. It covers damage from surface water, including overflowing waterways and water pooling on the ground that can seep into your basement through even the tiniest of cracks in your home’s foundation.
This form of insurance is relatively new and was introduced just a few years ago. If applying for this insurance and you live in an area that is prone to flooding, you will be considered a higher risk, and this may add to the cost of your premium. If you live in an area considered to be part of a floodplain, you may even be denied coverage.
Keep in mind also that a heavy rainfall can overwhelm municipal storm drains forcing wastewater back through drain lines. Unless you have added a sewer backup endorsement to your policy, you will not be covered if this mess ends up in your basement.
What Is the Best Way to Floodproof Your Home?
There are many things you can do to help protect your home from flooding. Not building in areas susceptible to flooding in the first place is one of the best ways to avoid floods, but with rising water levels, we now need to think about “climate-proofing” our homes. Here are some things you can do to reduce the potential for flood damage to your home:
- Install a backwater valve. If you don’t already have one, consider installing a backflow valve in your sewer line. That will prevent waste from coming into your home through your basement floor drain.
Depending on how much work is required for your home, the cost to install a backflow valve could be several thousand dollars, but when you consider the average cost to repair a flooded basement is about $43,000, this is money well spent. A backflow valve can also help reduce your insurance premium.
- Maintain eavestroughs and gutters. One of the easiest things you can do to protect your home is to make sure your gutters are free from obstruction and that downspouts direct the runoff at least five feet from your home’s foundation.
- Ensure the ground slopes away from the foundation. It’s also important to ensure that the ground slopes away from the base of your home. That will prevent water from pooling around your foundation and eventually finding its way into your home.
Before obtaining the insurance, it’s best to shop around to find the coverage you need at the lowest price, by comparing rates and policies from multiple insurance providers.