Insurance agents can help customers protect pipes from winter weather
How can you best prepare clients who may assume they are safe from bursting pipes?
It’s a cautionary tale as old as time: the cold winter months bring greater risks to the home.
Pipes, in particular, are prone to freezing and bursting in cold weather, resulting in property damage and a cascade of challenging claims.
See also: The big freeze: 5 signs your pipes are frozen and how to thaw them
When temperatures within the home are not maintained at a reasonable level, water within the plumbing system can freeze. Best case scenario: The ice that forms causes a blockage limiting or preventing water from reaching your taps and appliances.
However, in some cases, when water freezes within a pipe, that pipe expands. As the ice expands, it puts increasing pressure on the pipe walls. If the pressure is too great, the pipe can crack or burst, creating anything from a small leak to a deluge within the home.
What can make frozen pipe claims even more frustrating is that it is often not one pipe, but many that have split or burst. It is only when the entire system has thawed out, and water is running freely, that a homeowner will understand the full extent of the damage.
Here are two great tips that agents can offer their customers:
- Know the name and number of a reputable plumber in your local area and program them into your contacts list.
- Know where your water main shutoff valve is located and label it with a highly visible tag so that you or a member of your household can find it quickly in an emergency.
Every year, 250,000 homes suffer damage from frozen and burst pipes — creating between $2.7 and $3 Billion in damage. As insurance agents, you have heard the horror stories time and time again.
How can you best prepare clients who may assume they are safe from bursting pipes?
Let’s start with the harsh reality: When customers don’t take the right steps to protect their property, homeowner’s insurance doesn’t always cover damage caused by a burst pipe.
The average home insurance claim for water damage ranges from $10,000 – $15,000 per incident, according to data from Plymouth Rock.
Generally, homeowners’ insurance will cover damage due to frozen pipes if the homeowner has maintained heat in the home, typically above 55 degrees. If the home is seasonal, homeowners should winterize their property, which would include turning off the water supply to the home and draining the pipes. In either scenario, insulating exposed pipes and sealing air leaks can also help prevent freezing conditions.
Agents should approach homeowners right before the weather turns cold and inform them of the different policies carriers offer, including personal property coverage and dwelling coverage, to ensure they are protected. Agents also should consider the home, its occupancy and use (primary residence, seasonal or rental) when recommending a policy to their customers.
In the event that the insured has a covered frozen pipe loss, dwelling coverage (the Coverage A amount) is used for covered damages. Customers who have purchased replacement cost policies will first be paid the actual cash value amount, the depreciated value of the property immediately before the loss. Then, after repairs are completed, they will be paid the full replacement cost to restore the property to its pre-loss condition.
Personal property that is damaged as a result of a frozen pipe claim may be covered by the homeowner’s policy. If the personal property coverage is a named peril, agents must ensure that water damage is specifically included to cover this type of loss. With open peril coverage, agents must ensure that water damage is not specifically excluded.
Similar to damage to real property, contents coverage is typically paid at actual cash value. Replacement cost coverage is required to be fully indemnified for contents losses and is typically added by endorsement or select policies with higher premiums.
Dwelling coverage is there to help homeowners pay to rebuild or repair the physical structure of their home in the event of accidental water damage caused by a frozen burst pipe. Picture this, a frozen pipe bursts inside the kitchen wall and completely destroys the wall. The amount of coverage that dwelling coverage provides would be based on the estimated cost of rebuilding that kitchen wall. This is why agents must meet with homeowners yearly to re-evaluate the value of the home, especially after making even the smallest improvement.
In addition to explaining policies and coverage, it will be important to provide homeowners with the smart steps to take to maintain and protect their pipes, such as:
- Insulate pipes. Pipe insulation is a small investment compared to the repair costs of a burst water pipe. Be sure to insulate pipes located in unheated areas, such as the attic, basement, crawl spaces or garage. In extremely cold weather, pipes underneath the kitchen and bathroom sinks are also prone to freezing.
- Maintain a steady temperature. To prevent overnight freezing, be sure the home is roughly the same temperature during the day and night. It may raise the heating bill a bit, but it will also save from costly repairs and the frustration of a ruptured pipe. Even when homeowners (or renters) are not home it is important to keep the heat on and set to 55 degrees to ensure that pipes do not freeze… or even worse, burst.
- Keep sinks running. Another way to prevent frozen pipes is to let a slow drip of cold water come from the bathroom and kitchen sinks as the water movement prevents ice blockages from forming in your pipes.
- Open cabinet (and interior) doors. Plumbing in central spaces of the home also is extremely vulnerable to freezing. In most homes, the pipes are hiding behind the cabinet door. During freezing temperatures, agents should encourage homeowners to keep these doors open to circulate warm air. This also goes for interior doors as well as it invites the warm air to spread evenly throughout the entire house, not just within a single room.
- Have the name and number of a reputable local plumber in your contact list.
- Locate and label the water main shutoff valve in your home, share that information with everyone who lives there in case of emergency.
It will be important for agents to suggest homeowners conduct routine checks on pipes in and around the home throughout the year to protect from potential bursting pipes, water damage, unwanted claims and unneeded stress.
Andrew Leeds is vice president of claims at Plymouth Rock Home Assurance.
This piece has been published with permission and may not be reproduced.
See also: