Does homeowners insurance cover water damage in California?

It depends on what caused the water and on the exact wording of your policy. California homeowners policies commonly include sudden and accidental water damage, such as a supply line that bursts, and commonly exclude flood, seepage or leaks over time, wear and tear or lack of maintenance, and often mold. Sewer or drain backup usually requires a separate endorsement. Only your policy and your insurer decide what applies to your loss. This guide explains the usual categories and California’s claim-handling rules. It is not legal advice.

Safety first

Insurance can wait until everyone is safe. If you smell gas, see sparks, have water near the electrical panel or outlets, see a sagging or bulging ceiling, or someone is hurt, get out and call 911 from outside.

Sudden and accidental vs. gradual

The California Department of Insurance (CDI) homeowners guide lists “sudden & accidental water damage” among losses homeowners policies generally include. It lists “water damage caused by seepage or leaks” and “wear and tear or maintenance” among losses they generally exclude.

The facts of your loss decide which side of that line it falls on:

• Usually described as sudden and accidental: a washing-machine hose that splits, a supply line under a sink that bursts, a pipe that freezes and cracks, a water heater tank that suddenly ruptures.
• Usually described as gradual or maintenance-related: a slow drip under a sink that rotted the cabinet floor over months, a shower pan that leaked into the subfloor for years, a roof that leaked through several rainy seasons.

Many policies also treat the water damage separately from the thing that failed. The ruined drywall and flooring may be handled differently from the cracked pipe or the worn-out water heater itself. Read the “perils insured against” and “exclusions” sections of your policy form, and ask your insurer how they apply.

Flood is a separate policy

CDI states plainly that “homeowners policies do not cover flood damage.” The National Flood Insurance Program (NFIP) says the same: “Most homeowners and renters insurance does not cover flood damage.”

Under the NFIP’s definition, a flood generally means water covering two or more acres of normally dry land or two or more properties, such as an overflowing river or heavy runoff. Flood insurance is sold through the NFIP (via insurance companies and agents) and by private flood insurers.

Two facts matter in the Elk Grove to Stockton area, where parts of the region sit near Delta waterways and levees:

• NFIP coverage usually starts 30 days after purchase, with a few exceptions, such as buying it while you make, increase, extend or renew a mortgage. Buying after a storm is already forecast is usually too late.
• You can check your mapped flood zone on FEMA’s Flood Map Service Center. A low- or moderate-risk zone does not mean zero risk.

Sewer and drain backup usually needs an endorsement

According to the Insurance Information Institute, “sewer backups are not covered under a typical homeowners insurance policy, nor are they covered by flood insurance.” Backup coverage is usually sold as an endorsement to a homeowners policy or as a separate product. It often has its own limit, lower than your dwelling limit. Look for a “water backup” or “sewer/drain backup” endorsement on your declarations page. If you don’t see one, ask your agent.

Mold is often excluded or capped

CDI’s homeowners consumer guide says earthquake, flood, mold, earth movement and “wear and tear” are “not usually covered by a homeowner’s policy.” CDI’s claims guide adds that “mold damage caused by a covered peril may be covered.” Some policies exclude mold entirely. Others pay for mold that results from a covered water loss, up to a separate, lower limit.

CDI also warns that when water damage shows signs of leakage over time, “mold may have already developed.” That is one more reason to report and dry water damage quickly.

How to read your declarations page

CDI describes the declarations page as usually the first page of the policy. It shows the insurer’s legal name, your name and address, the policy number, effective and expiration dates, the premium, limits of insurance, covered property, deductibles and any lienholder. Check these items:

• Coverage A-F: dwelling (A), other structures (B), personal property (C), loss of use or additional living expenses (D), and liability and medical payments (E and F).
• Deductible: the portion of the loss you pay before the insurer begins to pay. It may be a flat amount or a percentage.
• Forms and endorsements: the list of form numbers that make up your policy. The exclusions are in those forms, not on the declarations page, and endorsements such as water backup or building code upgrade appear here.

Under California Insurance Code § 2084, after a covered loss your insurer must give you a complete copy of the policy in effect at the time of the loss, including endorsements and the declarations page. It has 30 calendar days from receiving your request and cannot charge you for it. Without a loss, you are entitled to one copy a year on request.

How to report a water loss

1. Protect the property. CDI says policies “may not cover ensuing damage” if you have not taken reasonable steps to secure the property from further damage. Stop the water, make temporary repairs if it’s safe, and save receipts for materials. CDI also advises against extensive permanent repairs until the adjuster has seen the damage.
2. Report it to your insurer or agent promptly. Write down the claim number and the adjuster’s name.
3. Document before cleanup. Take photos and video of rooms, the water line, damaged items and the source. List damaged belongings with brand and model numbers.
4. Keep a log. CDI recommends logging every call and keeping copies of all correspondence with your insurer.
5. Keep living-expense receipts if you must move out; those costs may fall under the policy’s loss-of-use section.
6. Expect a proof of loss form, a formal statement your insurer uses to evaluate the claim.

California claim-handling deadlines

California’s Fair Claims Settlement Practices Regulations (Cal. Code Regs., title 10, § 2695.1 and following) set deadlines for insurers:

• 15 calendar days after notice of a claim to acknowledge it, provide forms and instructions, and begin any necessary investigation (§ 2695.5(e)). Insurers must also respond to your communications within 15 calendar days (§ 2695.5(b)).
• 40 calendar days after receiving proof of claim to accept or deny it, in whole or in part (§ 2695.7(b)). A denial must be in writing, list its reasons, and tell you that you may have the matter reviewed by CDI.
• Written notice every 30 calendar days if the insurer needs more time. The notice must say what additional information it needs and why it cannot yet decide (§ 2695.7(c)(1)).
• 30 calendar days after accepting a claim to pay it (§ 2695.7(h)).
• If a settlement is based on a written scope or estimate prepared by or for the insurer, the insurer must give you a copy of each document the settlement is based on (§ 2695.9(d)).

Each deadline runs from a specific event, and the regulations contain exceptions. CDI can explain how they apply to you.

Where to get help

• California Department of Insurance: CDI runs a consumer hotline and accepts online Requests for Assistance about problems such as improper claim denial or delay in settlement. Start at CDI’s Getting Help page.
• Disagreements: for a dispute about your rights or what your policy means, contact CDI or a licensed professional, such as an attorney.

This guide is general information, not insurance, legal or adjusting advice. It explains how California homeowners policies commonly work. It cannot tell you what your policy will pay.