When your finished basement becomes an indoor pool, is there coverage?

Imagine you have just completed building out your dream man cave. You have spent $25,000 to build your perfect game watching/family avoiding finished basement place of your own. Overnight it rains 5 inches, and you awake to find that your man cave has transformed from Nirvana to an indoor swimming pool.

That's a bad day. It's a worse day if your insurance does not cover it.

Water that seeps through a basement wall is not covered by a typical homeowners insurance policy. However, if the basement is equipped with a sump pump or a drain, the policy can be endorsed to include Limited Water Back Up and Sump Discharge or Overflow coverage.

If the endorsement is added, the policy will pay up to the limit of liability shown in the endorsement for direct physical loss, not caused by negligence of an insured, to property covered under Section I of the homeowners policy for damage caused by water, or waterborne material, which:

1) Originates from within the dwelling where you reside and backs up through sewers or drains; or

2) Overflows or is discharged from a sump, sump pump or related equipment.

Depending on the insurance company, you can choose a limit of $5,000, $10,000, $15,000, $20,000, $25,000 or higher.

If you are interested in learning more, please contact The Russell Agency.

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