Does Homeowners Insurance Cover Foundation Repair?

It might. This is actually a controversial issue. There are a lot of stipulations that dictate whether foundation damage and repair related to a leak will be covered under homeowners insurance. For certain cases, yes, but for others, no. It all really has to do with the root cause of the leak. Once you identify why your foundation is leaking, you’ll be better able to grasp whether or not homeowners insurance will cover it.

When and How Does Homeowners Insurance Cover Foundation Repair?

There are very specific scenarios in which homeowners insurance will help pay for foundation repairs caused by a leak, and when they won’t. We’ll take a closer look each side for a better understanding.

Homeowners insurance covers foundation repair under the following conditions:

• A plumbing leak occurs in the soil around the home, eventually eroding it and causing a crack in the home’s foundation. This crack eventually begins leaking through the foundation into the home. Many homeowners policies will cover the resulting water damage and related foundation repairs because the problem stems from a sudden plumbing leak.
• A pipe bursts due to freezing, but you had already attempted to prevent this from happening by running the heat. Homeowners insurance usually will provide coverage for the resulting water damage and some foundation repair when leaks arise due to busted frozen pipes, after a failed attempt on your part to prevent them from freezing in the first place.
• Homeowners insurance will only cover the actual water damage from the foundation leak and whatever it costs to repair the damage and fix the leak itself, but it will generally NOT pay to replace the actual pipe.

Homeowners insurance also won’t provide coverage for foundation leaks or repairs that are caused by busted pipes installed in clay soil that expands and contracts with changing temperatures. This type of foundation leak is due to what’s known as “earth movement,” which is not a covered peril under homeowners polices.

Other causes may be excluded, as well. It’s important to review your specific policy to find out exactly what’s covered. Your independent insurance agent can go over your policy with you and answer your coverage questions further.

How Much Do I Have To Pay If Homeowners Insurance Does Cover A Foundation Repair?

If it’s covered, after paying your deductible, you’ll be responsible for any amount exceeding your policy’s limit for your home’s structure, including any covered foundation repair. These limits are often in the hundred thousands, but you may choose to increase them if you wish. Talk with your independent insurance agent about your concerns to determine if you need more coverage.

If Homeowners Insurance Doesn’t Cover A Foundation Repair, What Will?

If your foundation leak and any needed repair occur due to an uncovered peril under your homeowners insurance policy, you may need an entirely different policy to have coverage. Certain areas where soil expansion and contraction is common, such as Florida, offer a type of insurance called catastrophic ground collapse coverage, which could protect you from foundation leaks in the event of earth movement.

However, there’s unfortunately not an insurance policy that will reimburse you for all aspects of the foundation leak’s repair. There’s generally no insurance policy out there that will cover a broken pipe. You’d have to pay out of pocket to cover that aspect of the expense.