Water damage is the leading cause of property-related losses
for homeowners, according to Chubb claims data.
A recent Travelers report reveals similar findings: After
analyzing eight years of claims data, the insurer found that 20% of homeowners
claims were attributable to non-weather water issues including plumbing, sewer
or appliance leaks and failures -- making non-weather water losses the second most
common homeowners claim, after wind (24%). Meanwhile, 11% of homeowners claims
were caused by weather-related water.
Beyond just contributing to claims frequency, water is also
the culprit in many devastating losses. Travelers reports that non-weather
water and weather-related water damage accounted for 17% and 7% of the most
expensive homeowners claims in 2009-2016, respectively -- and since 2015, water
losses exceeding $500,000 have doubled, while those exceeding $1 million have
tripled, according to Chubb.
Despite all this evidence, however, consumers may not be
taking water threats as seriously as they should. Regarding weather-related
water losses, Chubb reports that nearly half of homeowners believe weather
reporting is "regularly" or "frequently" exaggerated, and 36% believe it’s "sometimes" exaggerated.
Furthermore, between summer 2017
and 2018 -- a timeframe that encompassed one of the worst hurricane seasons on record -- Chubb
reports that 64% of homeowners did not change their home protection strategies.
But people
are still at risk from hurricanes even if they don’t live near the coast: 33%
and 31% of Chubb’s Hurricane Harvey and Irma claims, respectively, were 25-50
miles away from the shoreline. And hurricane or not, flood remains the No. 1 disaster in the U.S., says Ana
Robic, COO, Chubb Personal Risk Services.
"A lot of
people think, 'This is never going to happen to me -- this is only a problem in X
location,'" says Tanya Brown-Giammanco, lead researcher on the Insurance
Institute for Business & Home Safety’s Hurricane Harvey Wind Damage Investigation Report. "But most
locations in the U.S. are prone to some kind of disaster."
Non-weather
water can also be more devastating than many homeowners may realize. "Once a
consumer has a water loss, they’re definitely more aware of it for the next
time," says Angi Orbann, vice president of Product Personal Insurance at
Travelers. "But other than that, consumers typically aren’t thinking about
those type of water losses."
And if a homeowner is away and
doesn't notice a leak immediately, "the damage can be quite severe," Orbann
adds. "Think about a two-story home where there’s a bathroom on the second
story. If that hose line goes, it’s easy for it to be running down to the
downstairs and possibly the basement for eight hours or longer if you’re away
for a weekend. Those claims tend to be very disruptive."
Robic
outlines a real-life scenario in which a homeowner was away on vacation when
their washing machine hose burst, causing water to run unmonitored for several
days. The water caused significant damage to the first and second floors of the
home, including substantial damage to a newly renovated kitchen on the first
floor.
At McCurdy Insurance,
we will talk with you about your most common and most expensive risks and
advise you on how to prepare for or prevent some of those losses.
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