Overland water coverage in Ontario, explained

This is general information about how home insurance is commonly written in Ontario. Policies differ. Read your own wording or ask your broker.

What it is

For decades, Canadian home policies did not cover flooding from outside at all. Overland water coverage, sometimes called overland flood coverage, was introduced by insurers in the mid-2010s as an optional add-on. The Insurance Bureau of Canada describes it as covering fresh water entering the home from overflowing lakes and rivers or from heavy rain and rapid snowmelt, and notes that it is now offered by many insurers for most properties.

How it differs from other water coverage

Where the water came from	Usual coverage
A burst pipe or failed appliance inside the home	Standard policy, as sudden and accidental water damage
Sewage or water backing up through drains and toilets	Sewer backup endorsement (optional)
Water entering at ground level from rain, snowmelt or a river	Overland water endorsement (optional)
Groundwater seeping through the foundation	Often excluded, or part of a broader water endorsement with some insurers
Salt water, storm surge	Generally not covered by overland water endorsements

A single storm can cause both sewer backup and overland water at the same time. If you have only one of the two endorsements, the insurer will look at which water did the damage. Some insurers only sell the two together, and some bundle them in one “water” package.

What it typically pays for

• Cleaning, drying and repairing the building
• Damaged contents, up to your contents limit
• Additional living expenses if the home cannot be lived in

It usually has its own limit, which may be lower than the cost of rebuilding a finished basement, and often its own deductible.

Who can get it

Availability and price depend on the flood risk at your address. For most Ontario properties it is offered. For homes in high-risk flood areas, insurers may decline it or price it very high. The federal and provincial governments have been working with insurers on options for high-risk properties, so this area is changing.

Questions to ask your broker

• Do I have overland water coverage, sewer backup coverage, both or neither?
• What are the limits and deductibles for each?
• Is groundwater seepage covered?
• Does a sump pump failure fall under sewer backup, overland water or neither?
• Would a backwater valve, sump pump or battery backup change my premium or eligibility?

If you do not have it

Government disaster assistance in Ontario is limited and is not a substitute for insurance. Reducing the risk is the practical route: see how to prevent basement flooding and the municipal subsidies on our service area pages.

If your home has just flooded

Start by limiting the damage and photographing everything, then report the loss. See what to do when your basement floods.

Why it was introduced

Until the mid-2010s, Canadian homeowners could not buy insurance for flooding from outside the home. After a series of severe floods, insurers began offering overland water coverage as an optional endorsement. Availability and pricing are based on flood risk at each address, using mapping that insurers have developed.

A practical example

A summer storm drops a great deal of rain in an hour.

• House A has water come up through the basement floor drain. That is sewer backup.
• House B, at the bottom of the street, has water pour over the driveway and in through a basement door. That is overland water.
• House C has both.

House A needs the sewer backup endorsement. House B needs overland water coverage. House C needs both, or a policy that combines them, or the claim will be split and partly unpaid.

What it usually does not cover

• Salt water flooding and storm surge
• Damage that could have been prevented by reasonable maintenance
• Groundwater seepage, unless the endorsement says so
• Flooding that is predictable and repeated at high-risk addresses, where coverage may not be offered at all

Wording differs between insurers. Read the endorsement itself, not only the summary.

How to find out your risk

• Ask your broker whether your address is rated as higher risk
• Check floodplain mapping from your conservation authority
• Ask your municipality whether your street is in a basement flooding study area
• Ask neighbours and the previous owner about past flooding

Cost and deductibles

The price depends mainly on the flood risk at your address and the limit you choose. Lower-risk homes pay modest amounts. Deductibles for water claims are often higher than for other claims, and some insurers reduce the premium if you have a backwater valve, a sump pump with backup or a water shut-off device.

Government assistance is not a substitute

Disaster assistance programs are intended for losses that could not have been insured, and they do not cover most of what a home policy would. Where overland coverage was available to you, do not count on public funds.