Leaks In Your Home Insurance

Here are some insurance tips to make sure that you don't end up paying for the costs of water damage.

Halifax Home Insurance says that if you have a water meter and you leave your taps running unnecessarily, you are 'literally pouring money down the drain'. I'm going to assume it meant 'figuratively', as I don't believe you're really getting bags of coins and tipping them into the water disposal pipes. (The best 'literally' mistake ever, according to The Fool's editor, is when Prince Edward said on a documentary: 'George VI was literally catapulted onto the throne'. Now that would have been something to see!)

Pedantic comments aside, Halifax has produced some interesting figures. It reckons that over the past five years, 17m of us, whether we have home insurance or not, have been affected by damage caused by water leaks. The cost of these each year is a massive £1.8bn.

The damage is caused by washing machines, showers, burst pipes, leaking baths, dishwashers and burst water tanks. It's also be caused by human error, such as leaving water to overflow when filling up baths and sinks.

Glossing over Halifax's uninspired suggestion that you turn off your taps when you're not using them, it did come up with other tips, some of which may be worth considering:

• Regularly check your pipes and appliances to find any potential weak spots. (I have to wonder who's going to bother doing that though!)
• When switching off taps, avoid over-tightening which can weaken washers and cause leaks. (Stop pumping iron. Got it.)
• Ensure pipes are well insulated to protect them from frost damage. (Yet another home improvement to add to the list.)
• Don't leave your central heating off for long periods during winter. When you go on holiday, use a timer to make sure the heating is on during colder periods of the day. (That'll keep the energy companies happy whilst you're away.)
• Always go with a reputable tradesman. Each year, Halifax Home Insurance receives thousands of claims for botched DIY jobs and work done by rogue traders. Similarly, don't carry out plumbing jobs yourself unless you're qualified plumber. (Hire people who can do the job. Gotcha!)

From my experience in the general insurance industry, I would add these tips:

• Don't get the water damage fixed without approval from your insurer, or it probably won't reimburse you.
• Your home insurance is not a maintenance contract. The insurer covers you for damage caused by escaping water. However, if, for example, a leak occurs because you failed to keep pipes or drains clean, or because you failed to have your boiler regularly serviced, those pipes, drains or boilers won't be repaired by the insurer. Only the damage caused by the water is covered. So maintain your water fittings!
• To resolve emergencies, you can buy home emergency cover which will cover temporary repairs for some of these things. It's important to read the exclusions though; for example, plumbing problems related to radiators are covered, but the radiators themselves aren't, nor is the cost of replacing parts damaged due to wear and tear. And there are many more exclusions where that came from!
• Damage caused by water to the building is covered under buildings insurance and damage to contents under contents insurance, so make sure you have the insurances you need.

I think we can safely now say that it makes sense to read and understand your home insurance small print before sitting back and letting your house collapse around you. Otherwise, you'll be up that creek without a paddle...literally.

> What are you waiting for? Compare home insurance through The Fool.
> Halve The Cost Of Home Insurance