09/02/2026
**“My water heater flooded the house! Now what?”**
A customer of mine called me with exactly that problem.
His water heater had started discharging water into his home. By the time everything was under control, his flooring had been damaged and drying equipment and fans were running for days.
Naturally, he wanted to know:
**What will my homeowners insurance actually pay for?**
The first part was relatively straightforward. The water heater and the damage caused by the water are not necessarily treated as the same loss.
The resulting damage to covered parts of the home — things like damaged flooring or sheetrock — may be covered under the property coverage of the homeowners policy, depending on the circumstances of the loss.
If a covered loss makes the home unfit to live in, Loss of Use coverage may also help with the necessary increase in living expenses while repairs are being made.
Then he asked the question that required a little more digging:
**“What about the water heater itself?”**
That's where things get interesting.
A homeowners policy can cover damage **caused by** an appliance without necessarily paying to replace the appliance that failed.
There is, however, an optional coverage called **Equipment Breakdown Coverage** that can provide protection for covered equipment when the damage results from certain types of mechanical, electrical or pressure-related breakdowns.
But it isn't a home warranty.
Ordinary wear and tear, rust, corrosion and deterioration aren't considered an equipment breakdown under the endorsement.
My customer didn't have Equipment Breakdown Coverage on his policy. But even if he had, I couldn't simply tell him, “Your water heater is covered.”
**We didn't know why it failed.**
Was it a covered mechanical breakdown? Corrosion? Deterioration? Something else?
I could explain what his policy covered and what the different provisions meant. Determining the actual cause of the failure — and whether it met the terms of the policy — was something I left to the claims adjuster.
And that's the part of insurance I wish more people understood:
**Insurance isn't always black and white.**
What caused the loss matters.
What was damaged matters.
And the coverages and endorsements you chose before the loss matter.
Sometimes your policy can pay for the damage something caused without paying for the thing that caused it.
That's why understanding your coverage **before something happens** is so important.
Not sure what your homeowners policy would cover?
**Send me a message. I'll be happy to help you understand it.**
**Real People. Right When You Need Us.**
InsureTXNow.com
469-802-0090
