Water Exclusion Clause


DEFINITION of 'Water Exclusion Clause '

A restriction in a homeowner's or renter's insurance policy that denies coverage for certain water-related claims. Types of water damage that are likely to fall under a water exclusion clause include damage caused by flood, tsunami, standing water, groundwater and drain/sewage backup. Some types of excluded water damage can be insured by purchasing a rider, while others cannot be covered at all or can only be covered through a separate policy.

BREAKING DOWN 'Water Exclusion Clause '

Water damage is one of several types of exclusion clauses commonly found in homeowners' and renters' insurance policies. Other common exclusions include earthquakes, landslides, war, nuclear hazards and government action. On the other hand, losses that most policies do cover include fire, wind, hail, vehicle damage, vandalism, theft, and falling objects, among other losses.

  1. Water Quality Insurance Syndicate ...

    An American company that provides water pollution liability insurance ...
  2. Flood Insurance

    A financial instrument that protects real property owners from ...
  3. Catastrophe Insurance

    Insurance to protect businesses and residences against natural ...
  4. Hazard Insurance

    Insurance that protects a property owner against damage caused ...
  5. Indemnity

    Indemnity is compensation for damages or loss. Indemnity in the ...
  6. Reinsurance Assisted Placement

    Insurance business that is developed with the help of a reinsurance ...
Related Articles
  1. Insurance

    Insurance Tips For Homeowners

    Use these simple ideas to save money and get better coverage for your house.
  2. Home & Auto

    The Beginner's Guide To Homeowners' Insurance

    Discover everything new homeowners need to know before they sign on the dotted line.
  3. Home & Auto

    Understanding Lender-Required Flood Insurance

    Having to buy flood insurance shouldn't be a surprise. Find out what you need to know when purchasing or refinancing a house.
  4. Options & Futures

    Insurance 101 For Renters

    If it's time for you to leave the nest, find out how to protect your new home from disaster.
  5. Insurance

    Do You Need Casualty Insurance?

    Find out how different types of coverages can protect you and which policy is right for you.
  6. Personal Finance

    Choosing An In-Home Safe: Features To Look For

    What to look for in a box to protect your irreplaceable belongings.
  7. Home & Auto

    Top-Tier Home Security Systems: Which Are Best?

    Here's help sorting out the different types of home security systems, which features will work best for you and the costs.
  8. Insurance

    Explaining Indemnity Insurance

    Indemnity insurance is an insurance policy that protects business owners and employees from losses due to failure to deliver expected services.
  9. Insurance

    What is a Force Majeure?

    A force majeure clause frees both parties in a contract from fulfilling their obligations in the event of some catastrophic or unexpected occurrence.
  10. Insurance

    How Car Insurance Companies Value Cars

    Learn the methodology used by car insurance companies to value cars, and understand why the amount they give you may not cover the cost of a similar vehicle.
  1. What is the difference between a peril and a hazard?

    The two related terms "peril" and "hazard" are often used in reference to the insurance industry. Essentially, a peril is ... Read Full Answer >>
  2. What risks do I face when investing in the insurance sector?

    Like all equity investments, insurance companies present investors with market risk. Insurance companies, like banks, also ... Read Full Answer >>
  3. What are the main factors that impact share prices in the insurance sector?

    The main factors that impact share prices in the insurance sector are interest rates, earnings and actuarial risk. In the ... Read Full Answer >>
  4. What level of reserve ratios is typical for an insurance company to protect against ...

    In the United States, and most developed nations, regulators impose required statutory capital reserve ratios on insurance ... Read Full Answer >>
  5. Why do insurance policies have deductibles?

    Insurance policies have deductibles for behavioral and financial reasons. Moral Hazards Deductibles mitigate the behavioral ... Read Full Answer >>
  6. Can I buy insurance to reduce unlimited liability in a partnership?

    Partnership insurance is actually quite common. Most of the time, partners buy insurance to safeguard against the possibility ... Read Full Answer >>

You May Also Like

Hot Definitions
  1. Section 1231 Property

    A tax term relating to depreciable business property that has been held for over a year. Section 1231 property includes buildings, ...
  2. Term Deposit

    A deposit held at a financial institution that has a fixed term, and guarantees return of principal.
  3. Zero-Sum Game

    A situation in which one person’s gain is equivalent to another’s loss, so that the net change in wealth or benefit is zero. ...
  4. Capitalization Rate

    The rate of return on a real estate investment property based on the income that the property is expected to generate.
  5. Gross Profit

    A company's total revenue (equivalent to total sales) minus the cost of goods sold. Gross profit is the profit a company ...
  6. Revenue

    The amount of money that a company actually receives during a specific period, including discounts and deductions for returned ...
Trading Center
You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!