Does Homeowners Insurance Pay for Foundation Damage
Depending on the cause of the damage, your homeowners insurance may cover damages to your home’s foundation. When your claim is covered, you won’t have to pay a big expense on your own. But there are plenty of instances where the foundational damage won’t be covered and you’ll need to pay for repairs out-of-pocket. Here’s a look at what kind of foundational damages are covered by homeowners insurance and which aren’t.
Damages Covered by Homeowners Insurance
Your home’s foundation damage may be caused by many factors and some of those factors are covered by homeowners insurance and some are not. It all comes down to what causes the damage to your home’s foundation.
If a tornado blew through your town, your homeowners insurance would cover the cost of restructuring your home’s foundation. Other instances where foundation damages may be covered by your homeowners insurance include plumbing backups, fires and explosions. If any of those instances caused the foundation damage, it would most likely be covered by your home insurance. That is why it is so important to review your homeowners insurance policy. The details about covered perils make all the difference in how well you are protected.
Damages Not Covered by Homeowners Insurance
Here are some instances where your homeowners insurance wouldn’t cover damage to your home’s foundation.
Most homeowners insurance policies don’t cover floods or earthquakes. So if your foundation is damaged from either of these natural disasters, you’ll need to pay for any foundation repairs out of your own pocket, unless you have separate flood or earthquake insurance.
Homeowners insurance doesn’t cover wear and tear on your home’s foundation. Home foundations shift over time, which can lead to cracks in your home’s structure. Keeping close tabs on your home’s aging foundation is considered the homeowner’s responsibility.
Here are some other problems with a home’s foundation that may not be covered in homeowners insurance from the American Society of Home Inspectors:
Misuse of Soil. The misuse of soil is a big cause of foundation damage. The weight of your home will condense the soil beneath it over time. And if the soil is compacted unevenly at the start, your house may settle unevenly and begin to crack.
Improper Drainage. Having poor drainage can lead to wet and dry patches beneath your home. Wet patches tend to push under your foundation and dry patches tend to shrink. This movement affects the foundation of your home. To limit this issue, make sure your gutters are leading water far enough away from your house. Also check that the ground is sloped away from and not toward your house. Having updated drainage helps prevent water damage and keeps moisture levels uniform.
Tree Roots. When there is a tree too close to your house, it can push against your home’s structure. The tree can drain high volumes of the soil’s water beneath your house. This drastic change in moisture levels can have drastic results on your foundation. And you’ll need to pay for repairs to this damage yourself, since insurance won’t cover it.
Temperature Changes. Hot and cold temperatures can cause water molecules in the soil to shrink and expand. As time passes this can result in damage to your home’s foundation. The damage caused by temperature changes is usually not covered by your homeowners insurance. You would have to pay for these damages out of your own pocket.
About Your Home’s Foundation
Whether your home’s foundation is poured concrete, block or stone, it is important for a home to have a solid foundation.
Most home foundations are built using poured concrete. And if poured correctly and on a firm footing, a concrete foundation can last a lifetime.
But even concrete foundations are susceptible to the forces of nature such as water erosion. Water erosion is the number one cause of problems for home foundations.
If too much water accumulates around your home’s foundation, the land under the foundation can be washed away. And this causes the foundation to move.
And even though it is not unusual for concrete foundations to have small cracks, be leery of new cracks or older ones that have gotten bigger.
Keep in mind that water seeping into the house around the foundation is a sign that water may be starting to compromise the foundation. On the flipside, a long drought may cause your home’s foundation to settle. So too much and too little water can have a negative impact on your home’s foundation. Monitor both situations carefully. Have a foundation specialist check out the extent of the damage.
Warning Signs Something Is Wrong With Your Home’s Foundation
Not sure if something is wrong with your home’s foundation? Here are some key warning signs that may signal trouble for your foundation and for your home.
Cracks. It is normal for a foundation to sink and develop tiny cracks in the first two or three years after construction. These hairline cracks are common. Larger cracks are cause for concern. So if your cracks are anything but tiny, you may have problems with your foundation.
A Settling or Sinking Foundation. If your home appears to be sinking or having settlement issues be sure to have your home’s foundation checked out by a professional who can assess the damage.
Foundation Upheaval. If your home’s slab foundation has moved in an upward direction, this is called foundation upheaval. This upheaval generally affects the perimeter area of your home’s slab foundation but it can affect your home’s interior including doorways and hallways.
Sticking Doors. If you notice that your home’s doors are sticking or not opening and closing properly, this could be a sign there is a problem with your home’s foundation.
Gaps Around Windows and Doors. Homeowners often notice gaps around their exterior window frames and exterior doors. They may even notice that doors no longer latch. These are all signs of problems with a home’s foundation.
Uneven Floors. If you notice floors that are out of level and appear to be sagging or dipping, you may have problems with your home’s foundation.
A Wet Crawl Space. Finding heavy moisture in a crawl space is a sign that your house has a foundation problem. Have a professional investigate this problem immediately.
Cabinets Separating from the Walls. If your kitchen cabinets and countertops seem to be pulling away from the wall, this is a sign you may have problems with your home’s foundation. When walls aren’t level, the cabinet and countertops won’t be level either.
Does Your Home Insurance Policy Cover Foundation Repairs?
Not sure if your insurance company covers foundation repairs? Now is the time to ask.
- Here are some questions to ask your insurance agent about foundation repairs.
- Will my policy cover foundation repairs and in what instances?
- Will they cover the repair of small cracks in the foundation?
- What foundation repair methods do they cover?
- How much will insurance cover the cost of foundation repairs?
- What kind of evidence do they need about the foundation problem?
Keep in mind an insurance company may cover foundation repair costs in specific instances but they may not cover damage caused by the movements of soil.
How Foundation Damage Affects Property Value
All of your home’s main structures including its foundation have a direct impact on its property value.
In fact, most foundation problems reduce a home’s value by 10 to 15 percent. For a $250,000 home that would mean a drop in value of $25,000 to $37,500.
Having a foundation issue in your home is a serious problem and one that you will want to address if you are selling your home. You have two choices. You can hire a contractor to fix the issue or you can reduce the sale price of your home to offset the cost of the repair.
How much will it cost to repair a home’s foundation? The cost of the repair varies based on the type of foundation, severity of the problem and the size of the house.
Minor cracking can be repaired for a few hundred dollars. A more severe problem could cost thousands.
Another downside to foundational damage is how the home appears to potential buyers. A home with sagging floors, ceiling cracks and foundation cracks are turn offs to potential home buyers. As mentioned earlier, you will need to correct these issues or knock down the asking price of your house.
If you have problems with your home’s foundation this leads to sagging floors, roof issues, cracks in walls and ceilings and broken or cracked windows. So don’t put off foundation issues. You’ll have more problems on your hands if you wait.
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Every year, thousands of Americans receive surprise letters notifying them that their carriers won't renew their homeowners insurance once their coverage expires. Insurers don't renew these policies for a variety of reasons.
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