Sewer backup insurance in Ontario: what it covers

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

A standard home policy does not cover water that backs up into the house through the drains. Sewer backup coverage is an endorsement you add, for an extra premium, that fills that gap.

It responds when water or sewage enters through:

• A floor drain
• A basement toilet, shower or sink
• A sewer or septic line
• In many policies, a sump pit when the pump fails or is overwhelmed

What it typically pays for

• Removing the water and sewage
• Removing and disposing of contaminated materials
• Cleaning, disinfecting and drying the structure
• Rebuilding walls, floors and finishes
• Damaged contents, up to your contents limit
• Additional living expenses if the home cannot be lived in

What it does not cover

• Overland water, meaning water entering from outside at ground level. That is a separate optional coverage.
• Groundwater seepage through the foundation, unless your policy says so.
• The repair of the pipe itself. A collapsed lateral or a blockage is usually your cost.
• Gradual damage from a problem that was known and not fixed.

A single storm can cause both sewer backup and overland water. If you have only one of the two coverages, the insurer will look at which water did the damage.

Limits and deductibles

The endorsement usually has its own limit, which can be much lower than the limit on the building as a whole. A finished basement with a bathroom, flooring, drywall and furniture can exceed a modest limit quickly, especially after a sewage loss where almost everything porous is replaced.

There is often a separate, higher deductible for sewer backup claims. Both figures are on your policy declarations page.

How to check whether you have it

1. Find the declarations page of your policy.
2. Look for a line such as “sewer backup”, “water and sewer backup” or a broader water protection package.
3. Note the limit and the deductible.
4. If you cannot find it, call your broker and ask directly. Do not assume.

What affects the price and availability

• Your address and its claims history
• Whether the basement is finished
• Past sewer backup claims at the property
• Protective devices

Many insurers offer a discount, and some require, a backwater valve, a sump pump with battery backup or both. Several Ontario municipalities subsidise this work. See the backwater valve guide.

If you have a backup

1. Stop using water and keep people out of the area.
2. Photograph everything.
3. Report it to your municipality.
4. Start emergency cleanup. Policies generally expect you to limit the damage.
5. Report the claim and keep all receipts.
6. Keep damaged items until the adjuster has seen or released them.

See sewer backup: what to do first.

Tenants and condo owners

Tenant and condo unit policies can also carry sewer backup coverage for belongings and, in a condo, for improvements to the unit. Ask for it specifically if you live at or below ground level.

A worked example

A finished basement with a bathroom, laminate flooring, drywall and a sofa backs up during a storm. The cleanup removes the flooring, the lower drywall and insulation around the room, the vanity and the sofa. The space is disinfected and dried, then rebuilt.

Add it up: emergency response, disposal, disinfection, a week of drying equipment, new drywall and insulation, flooring, trim, paint, a vanity, and the contents. On a sewage loss almost nothing porous is saved, so the total climbs quickly.

If the endorsement limit is low, the claim can reach it before the rebuild is finished, and the rest is the homeowner’s cost. This is why the limit matters as much as having the coverage.

Questions to ask your broker

• Is sewer backup on my policy, and what is the limit?
• Is there a separate deductible?
• Does it include sump pump failure and water entering through the sump pit?
• Is overland water included or separate?
• Does the limit apply to building and contents together or separately?
• Would a backwater valve or a sump pump with battery backup reduce the premium?

More: sewage backup cleanup.