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How much sewer backup insurance coverage should I have?

Water is great when it’s in a swimming pool a lake or in a nice tall glass filled with ice. But water isn’t so nice when it’s sitting in your basement, mixed with dirt, debris and refuse. That’s an expensive situation that must be handled quickly.

Many homeowners have been victims of sewer backup accidents. It’s a big mess to clean up and with so many basements being finished these days, it can be a huge expense too. Luckily, there are ways to protect your home and insurance if the worst should happen. Sewer backup coverage can be added to your home insurance policy. But how much coverage should you have?

What is sewer backup?

A sewer backup occurs when a drainage system overflows and sends water back through the pipes and into your home. This backup can happen for a number of reasons:

  • snowmelt
  • line blockage
  • torrential rainstorm
  • failed sump pump
  • failed backflow valve

A sewer backup can come from a variety of sources including a storm drain, sewer system and even a septic tank.

Unfortunately, sewer backup is rarely just clean water. It’s often dirty water and can even contain sewage. This is why cleanup can be so difficult!

How does sewer backup coverage work?

Sewer backup coverage covers damage caused by backup through your home’s drainage system. If the water in your basement is caused by sewer backup, you’ll be able to make a claim. Once the deductible is paid, your insurance company covers the rest of the cost to repair the damage and replace belongings that were destroyed – up to your policy limit.

That’s where the question of how much sewer backup coverage comes into play.

How much sewer backup coverage should I have?

Different insurance companies will offer different levels of coverage. Sometimes there is a separate deductible and limit for sewer backup (different than if another insured peril caused damage to your home).

We recommend the maximum amount of sewer backup coverage you can get to the extent you’re fully insured for a sewer backup event.

A simple method is to figure out how much it would cost you to replace everything in your basement. This not only includes your belongings and furniture, but also the flooring, drywall and other materials that could be destroyed by water. Don’t forget to leave yourself some wiggle room for the potential increased cost of labour and materials.

To calculate costs, you will need to factor:

  • Your location
  • The square footage of your basement
  • The portion (percentage or square footage) of your basement that’s finished, if any
  • An estimated cost to replace your belongings
  • An estimated cost to replace your upgrades  (assume an unfinished basement as a base line).

For example, for a 900 square foot, completely finished basement with $25,000 worth of personal belongings and $15,000 worth of upgrades the tool suggests just over $62,000 of coverage.

Sewer Backup Coverage Eligibility

While most home insurers now offer sewer backup coverage, there may be eligibility requirements. Some insurers will not sell this coverage to homeowners whose home has a history of seepage, groundwater issues, or flooding. If your home is located close to a river or lake you may also not be able to get coverage.

Talk to your broker about your eligibility for sewer backup coverage. They’ll be able tell you what your insurer offers and advise how much sewer backup coverage you need.