Water damage is a common and often devastating problem for U.S. homeowners and around the world. Let’s take a deep dive into water damage statistics, homeowners insurance vs flood insurance, what is covered and more.

• Water damage is the second leading cause of property damage insurance claims in the U.S., behind wind and hail damage.
• The average water damage insurance claim is approximately $12,500
• Around 1 in 50 homes with insurance will file a water damage claim each year
• In the U.S., it is approximated that 1 trillion gallons of water is wasted annually due to leaky pipes, faucets, sprinkler systems and more
• The most common causes of water damage include plumbing failures, appliance malfunctions and roof leaks

The average insurance payout for water damage is $12,500, and this only accounts for the 93% of homeowners that have insurance. Home insurance might not cover water damage if it is the result of flooding or a weather-related cause. Having flood insurance is essential to those that live in high-risk flooding areas. Water damage restoration professionals classify water damage into 4 classes, 1 being the least severe and 4 being the most severe.

• Class 1: Minor water damage that is contained to a singular spot of a room.
  • Average restoration cost: $150-400
• Class 2: Water damage through an entire room, including walls up to 12 inches or less.
  • Average restoration cost: $500-$1,000
• Class 3: Water damage that affects a whole room or multiple rooms. This level of damage may affect ceilings, subflooring, walls and insulation.
  • Average restoration cost: $1,000-$3,000
• Class 4: Water damage because of long-standing water or from a weather event like a flood or storm. This level of damage may affect structural materials like brick, stone and hardwood.
  • Average restoration cost: $20,000-$100,000

Similar to how there are 4 classes of water damage, there are 3 categories of water contamination that can affect the extent of the damage and the price of restoration.

• Category 1: White water – Water from a hygienic source such as a leaky faucet or pipe, rainwater and melted snow.
• Category 2: Grey water – Water that has been exposed to contaminants such as debris or chemicals.
  • Average restoration cost per square foot: $4-$6.50
• Category 3: Black water – Water that is dangerous and contaminated that has been in contact with sources such as sewage, river or lake water. Flood water is considered black water.
  • Average restoration cost per square foot: $7-$7.50

Damage and the cost associated with it can vary depending where in the home the water damage is located. Below is an outline with data sourced from HomeAdvisor on the price of different water damage repairs:

• Bathroom fixtures: $150-$350
• Floors: $200-$500
• Drywall: $300-$800
• Ceiling: $350-$1,250
• Roof: $400-$1,700
• Basement: $500-$80,000
• Plumbing: $1,000-$4,000

The National Flood Insurance Program (NFIP) can provide flood insurance to homeowners, renters and businesses. The Federal Emgercency Management Agency (FEMA) also offers some relief to certain homeowners who experience devastation from a flood or natural disaster – however, the average NFIP claim to restore damage after a flood is $52,000 and the average FEMA payout is $4,200. Flood insurance typically costs around $700 per year. Flooding is far more common than many realize.

• Floods cause $8 billion in damages in the U.S. annually
• 99% of counties experienced floods between 1996 and 2019
• The U.S. has experienced an urban flood event every 2-3 days for the past 25 years
• Since 1980, there have been $1 trillion in damages caused by flooding

With water damage being such a threat to homeowners, you may be wondering: what are the leading causes of water damage?

• Severe weather
• Clogged gutters
• Leaking pipes
• Problems with appliances
• Condensation from AC units
• Blocked drains

Beyond the damage caused to your home, there are other serious concerns that come along with water damage. When left untreated, water damage can lead to serious health problems including mold allergies, respiratory infections and asthma. Untreated water damage can also cause structural damage to homes. Below is a timeline on how water damage can affect a home.

• In minutes, carpets and flooring absorb water. Furniture and carpets begin to stain. Personal belongings such as photos and paperwork may be destroyed.
• In hours, humidity can cause a bad smell and cabinetry and furniture may weaken or deteriorate. In 48 hours or less, white or grey water can become black water.
• In days, fungi and mold set in. Floors and walls will likely have deteriorated to the point where they will need complete replacements. The home’s structural wood will have likely begun swelling and splitting.
• In weeks, if left untreated, the home is likely hazardous and unlivable. Drywall will be crumbling and the structural integrity is unsafe. While the home may be salvageable, restorations will be expensive and extensive.
• In months, the damages are likely to cost more than the price of the home, and it will probably be unsalvageable. The owner may not qualify for an insurance claim due to neglect.

What kind of water damage is typically covered by home insurance?

• Burst pipes
• Accidental leaks
• Water damage after a fire
• Water damage from a roof leak
• Water damage from heavy rain or hail
• Ice dams

What type of water damage is typically NOT covered by home insurance? Water damages due to flooding, earthquakes or hurricanes will not be covered by a typical home policy.

• Flood damage
• Earthquake, landslide, or mudslide damage
• Damage due to lack of maintenance or negligence
• Damage due to intentional acts
• Water damage from leaks from a pool or similar structures
• Cost to repair the source of damage such as washing machine or dishwasher
• Water damage from a sump pump failure

Homeowners can help prevent water damage by maintaining their homes, watching for and fixing leaks immediately and utilizing water detection/water shut-off devices. With 1 in 50 insured homes making water damage claims every year, it is a very common problem and one to be vigilant about. It’s important to remember that the source of water damage will play a role in whether or not damages can be covered by a standard home insurance policy. Talk with your independent agent today to see if flood insurance or other supplemental coverage is right for your unique situation.

We are here to serve as your trusted advisor. If you have questions or would like to be quoted for a policy, please call or text us at (360) 514-9550 or email us at info [at] davidsoninsurance [dot] com.