Will my insurance cover me for water damage in Australia? 

In Australia, water damage is one of the most common forms of home and business damage, and one of the most common insurance claims made. From data from the ISO, water damage claims are the second largest common insurance claim made in Australia, following wind and hail damage

Water damage in your home, office or business is far more common than you think. In Australia, roughly 20% of all new claims involve water damage.

But figuring out whether your home or business insurance will actually cover you for the damage that has occurred can be very difficult. 

Storm damage is the most common home and contents insurance claim in Australia

According to Australian Insurer Aami, storm damage was the most common home and contents insurance claim in 2018, representing a staggering 21.6% of all claims.

Water, windstorm and hail damage represents over 50% of all insurance claims!

The second-highest insurance claim type according to Aami was water leakage, representing 20% of all claims, third was ‘windstorm,’ making up just under 10% of all claims made.

Based on that data from Australian insurer AAMI, insurance claims involving some form of water damage (not including hail damage), make up over 50% OF ALL CLAIMS!

For perspective, In the 2017/18 financial year, bushfire claims were only 0.1% of all claims!

Why it’s difficult to establish whether you are covered for water damage

Working out whether or not your insurance will cover you for water damage is difficult because it can be hard to establish whether the damage occurred from ‘gradual damage’ or from ‘accidental or sudden damage.’

Water damage is divided into two main categories

Different types of water damage are divided into two main categories. The first of these categories is loosely termed ‘accidental or sudden damage.’

This type of damage is often covered by insurance providers (but not always). Insurance policies will usually cover sudden or accidental damage. this refers to damage that did not come about slowly or over an elapsed period of time.

The second type of insurance damage is termed ‘gradual water damage.’ Gradual water damage is usually not covered by insurance.

1. Taps or pipes that are leaking as a result of corrosion that came about from their age 
2. Poorly constructed repairs or evidence of a lack of expected maintenance to the home, premises or business.
3. Leaks or damage caused by a roof, guttering or downpipes that are rusting or deteriorating due to age
4. Deteriorating electrical wiring. For example, many old properties have cotton wiring or wiring completed by unlicensed professionals (NB; a fire caused by faulty electrical work from an unlicensed contractor is not covered under any insurance policy – even if that work was carried out before you rented or purchased the property).

What kinds of water damage are you covered for under your insurance policy?

Most Australian Insurance policies will cover (make sure you check your individual policy to confirm) loss or damage caused by leaking, overflowing or bursting water including:

1. Water damage caused by faulty appliances including refrigerators, freezers, dishwashers and washing machines (if those machines are deemed to be in a reasonable condition – ie, you may not be covered for damage caused by a 50-year-old leaking fridge).
2. Leaking or overflow from drains, fixed pipes, guttering and rainwater downpipes, drainage and sewage systems
3. Water damage caused by fixed water tanks, swimming pools or spas or waterbeds
4. Leaking from baths, sinks, toilets, and basins
5. fixed heating or cooling systems
6. Damage caused by water mains, fire hydrants or water supply pipes

However, there are some exceptions to the above. If there’s a leaking shower floor or base in your bathroom, or your swimming pools or underground tanks have water leaking from them, you may not be covered.

As we said earlier, you should check your policy document to see what’s covered and what isn’t covered.  

What kinds of water damage are not covered (or not likely to be covered) by my insurance company?

What you will need to lodge a water damage insurance claim with your insurer

1. Your policy number (if you can’t remember it then just do a search in your email folder. If that doesn’t work call your insurer).
2. if you’ve got any electrical items or other damaged items, get the details about the make and model. Photos fo those items are good too.
3. Any photos or documents related to the claim – if you don’t have any take some
4. As many details as you can provide about when the event occurred and what happened

What if I haven’t lodged a claim with my insurer yet but need the work done now

If you have not lodged a claim with your insurer yet but you need the work done now then just call us. We can help get the job started and begin fixing your house or property while we help you lodge your claim. 

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