Water-Damage Insurance: A Smart Business Investment

9/25/2019 (Permalink)

Flooding and water damage is usually covered by two different insurance policies

Water is a resource that humans, animals and plants use for hydration, recreation and irrigation. It’s when water flows where it doesn’t belong that problems can occur. Water damage is one of the costliest emergency expenses a business can sustain. Proper insurance coverage can protect your Elkton, KY, business from unexpected financial loss.

Sources of Water-Related Damage

Because water is such a plentiful natural resource with endless uses, most dwellings are susceptible to losses caused directly or indirectly by water. Overlooked maintenance, severe weather or other unforeseen events can be associated with the following sources of damage:

• Broken pipes or slow leaks
  
• Water heater, evaporative cooler or specialized equipment leaks
  
• Toilet malfunction
  
• Refrigerator leaks
  
• Municipal engineering malfunctions, such as water-main breaks or dam breaches
  
• Weather-related events, including extreme freezing, snowmelt and extreme rain
  
  
  

Your business insurance coverage is your first line of defense against most forms of potentially costly water damage.

Primary Insurance

It is recommended you confirm with your insurance agent that you have adequate coverage for various types of water-related damage. Many business owners fail to procure adequate coverage, although property damage from leaks or storm events is quite common. When it comes to flooding, your business insurance will generally carry an exclusion, which means an additional policy will be required to address flood damage.

Flood Insurance

Flood insurance coverage for buildings and contents is government-issued, though it does require an insurance agent to broker the plan. The policies generally cover property loss, structural damage and water cleanup by a specialized restoration company; some plans cover lost revenue. It is important to assess your flood risk when purchasing commercial property as certain levels of risk can require mandatory flood policies.

It is not uncommon for commercial property owners to be underinsured for water damage. Any facility with an HVAC system or a bathroom is at risk, making most businesses vulnerable. Damage from flooding or water leaks can break the bank if your business isn’t properly insured. It may be useful to have your coverage evaluated to confirm you have the insurance you need to protect your property and your peace of mind.