As a new homeowner, you’ll want to clarify with your provider exactly how your homeowners insurance covers foundation issues. A strong foundation keeps groundwater out, insulates your home, and offers some cushion against the natural tectonic shifts of our earth. Unfortunately, various problems may occur with your foundation over time, and only some of them are acknowledged by most insurance plans.
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Does Homeowners Insurance Cover House Foundation Repair?
Homeowners insurance will reimburse house foundation repairs only if a covered peril like a fire, lightning strike, or falling tree causes damage. Companies will typically exclude most other foundation issues that occur gradually below the slab. A standard homeowners insurance policy would payout for these covered perils up to the stated limit under its dwelling section.
What is a Covered Peril?
In the context of homeowner’s insurance, covered perils portend to any incidental damage incurred by your home that your insurance company would be obligated to have fixed. The dwelling coverage section of your policy concentrates on any structural damage inflicted upon your home, its foundation, or any other attached structures.
Covered perils may include weather-related disasters like windstorms and fire or human-oriented problems like vandalism or theft. Some policies offer named-peril coverage, meaning your policy only covers risks specified therein, and open-peril coverage, which would cover all perils except those explicitly excluded in writing.
When Your Insurance Policy Will Cover Foundation Damage
Homeowners insurance will often cover foundational damage above the slab occurring from the following perils:
- Lightning or fire
- Vehicle or aircraft collisions
- Vandalism or riots
- Falling objects, like trees
- Water damage from plumbing or HVAC
- Collapse due to heavy snow or ice
Homeowners policies rarely cover damage considered to occur gradually. Other natural perils like earthquakes and flooding rarely see inclusion in standard homeowners policies, though many companies offer supplemental plans for either catastrophe. Read through your policy to know exactly where you stand and how to prepare for mother nature’s toughest challenges.
How Much Are You Covered For?
Your home insurance policy most commonly reimburses you for foundation repair up to the replacement cost coverage limit specified in your dwelling policy. Replacement cost refers to the amount of money it would take to rebuild your home to its original standing using similar materials.
Dwelling coverage limits can range between $100,000 to $500,000, well more than you’ll need in most cases to repair damages around your home. The average cost of foundation repair is anywhere between $4,500-$25,000 depending on the severity. Your policy will reimburse you for these repairs minus the deductible amount specified in your policy that you must pay out of pocket.
When Your Policy May Not Cover Foundation Damages
Standard foundation coverage insurance excludes non-accidental damages that occur gradually or below the slab. These excluded damages may stem from the following:
- General wear and tear
- Natural settling, shrinking, expansion, or cracking of the foundation
- Soil compaction or erosion
- Water damage caused by poor drainage or leaks
- Earthquakes or flooding
- Tree roots
- Defects left by faulty construction
- Rodent or insect infestation
Policy riders and specialized supplemental insurance plans exist to help provide coverage for some of the excluded situations listed above. In contrast, others gradual hazards like soil compaction and erosion are essentially uncoverable. Below we detail some frequently excluded damages.
Preconstruction and Ground Preparation
A shoddy foundation resulting from lazy or negligible construction can lead to severe long-term issues. Homeowners insurance, unfortunately, will not cover damage incurred during preconstruction or ground preparation. Insurers consider it your responsibility to secure a proper home foundation inspection before buying any property.
If your provider deems the preconstruction damage uncoverable, there might still exist other pathways toward compensation outside of an insurance claim. Depending on the provable severity of a substandard slab job, you could build a case against the original builder and seek a settlement through litigation.
While homeowners insurance often covers water damage due to leaks resulting from plumbing or HVAC systems, it excludes coverage for water damage from flooding, improper drainage systems, or foundation leaks.
Your provider will consider it your responsibility to limit water intrusion by ensuring proper drainage around your home. You should always clean your rain gutters and ensure they drain properly away from your house. Modernize your gutter and downspout systems, install french drains and other drainage systems around your home to prevent water from infiltrating expansive soil, and schedule regular maintenance on your sewage lines.
Tree roots growing too close to your home can quickly compromise your foundation. Roots from trees too close to your house expand underneath your foundation and draw in moisture, causing nearby soil to expand and contract, inevitably shifting and cracking your foundation. Foundation repair insurance usually excludes damage caused by tree roots growing near the home.
Keep an eye on your trees, and relocate them if necessary. If you plan to plant new trees, do so with a generous runway between them and your home. Older house experience greater susceptibility to tree root damage because the trees have been there decades longer, their roots still growing deeper by the day.
Insurance companies almost always deny coverage for settling, shifting, or cracked foundations resulting from extreme temperature fluctuations. Extreme temperatures lead to the soil eroding, expanding, and contracting, often resulting in poor natural drainage around your home.
Your provider will not view damages resulting from slow changes in the makeup of your soil as “sudden or accidental,” disqualifying them from coverage. They will deem it your responsibility as a homeowner to practice diligence in accommodating and addressing such problems through routine maintenance. Stay alert during the more intense winter and summer months when foundational issues commonly arise.
What To Do if You Experience Foundation Damage
If you experience any noticeable damage to your foundation, contact your insurance company immediately to file a claim before anything worsens. You can hire a professional to offer a second opinion, legitimize your claim, and help outline the best path forward.
Most importantly, try to prevent foundational damage before it ever has a chance to happen. Stay attuned to changes in the environment surrounding your house, and keep a heads up for any warning signs that would point to trouble down below. If you live in earthquake or flood-prone areas like California or Florida, consider taking out related supplementary homeowners insurance to ensure you see coverage in the event of either typically uncovered peril.
Foundation Damage Warning Signs
A variety of symptoms can indicate foundation damage. Look for cracks in the walls outside your home, wet crawl spaces, and in-home structures or entryways that may be leaning or warped. White powder near the foundation can indicate crumbling and erosion, and an excess of bugs in your home might also point to cracks in the foundation they can use as entryways.
Failing to act at the onset of foundational issues can lead to significant structural damage to your entire home. The longer the problem persists, the worse off and more expensive repairs become. Below we detail the three main types of foundational disrepair.
Inspect your basement and crawlspace for wetness or hotspots, which likely indicate a foundation leak. Foundation leaks stem from oversaturated and expanding soil around your home. If you do not have a basement or crawl space, other signs of leakage include mold, inflated water bills, marshy ground around your home, and faint sounds of running water. Water seeping into an already cracked foundation can rapidly deteriorate its integrity. Call an expert immediately should any of these warning signs present themselves.
Foundation Cracks or Settling
Horizontal or zigzagged cracks in the structures around your home–exterior walls, interior sheetrock, chimney, tiles–often indicate similar cracks or settling in your home’s foundation. If these above-ground cracks grow and become longer, the same cracking is likely occurring below your foundation. Fill in foundational cracks with epoxy to buy yourself time before enlisting professional assistance.
Foundation Movement or Sagging Floors
Warped walls, ceilings, floors, and support posts indicate a sagging or moving foundation, as do leaning doors and windows that won’t close or latch properly. Counters and cabinets may separate from your walls as the foundation shifts below. Professionals can fix a sinking foundation by installing steel piers in the ground around your home, raising it to its original height, and permanently holding it in place.
How To Prevent Foundation Damage
Even if your provider provides insurance for foundation repair, you’ll feel better off never having to utilize it. Some simple methods of preventing foundation damage include:
- Arrange a home inspection before moving in.
- Maintain your soil.Know your local climate and keep it from getting too wet or dry. Lay some mulch to help regulate moisture and temperature
- Check your grading. At least 6 inches of grading around your home should suffice to help water drains properly when it rains.
- Stay weary of the trees and their roots surrounding your home.
- If you discover cracks or other problems in your foundation, attend to them immediately.
How Do You File a Claim for Foundation Damage?
Foundation repair insurance claims tend to carry a statute of limitations following discovery, so contact your insurance company to file a claim as soon as you know of any issues. Take photos and gather as much evidence of the damage as possible to make proving your case and receiving a payout easier.
While your provider will send their appraiser over to assess the damage, consider hiring a foundation specialist to advance your claim. Once you’ve filled out the claims forms and all inspections are complete, an independent contractor must survey your property and deduce a total repair estimate.
What Can You Do if You’re Not Covered by Homeowners Insurance?
Suppose your insurance provider denies coverage for foundation repair due to an uncovered peril or any other reason; there may still exist a few strategies outside of paying out-of-pocket. You hold the right to dispute any denial from your insurer, especially if their reasoning conflicts with the statement issued by the contractor tasked with the repair.
You can also hire a public adjuster to help guide you through your claim and steer you toward the best solution with your insurer. A public adjuster typically works pro bono for around 5-15% of your compensation should the case get resolved.