Sewer Backup Claim - Public Adjuster

Sewer or Drain Backup Endorsement leads to numerous claims being denied or underpaid.

Overview of Current Claim Trends

As a Public Adjusting firm assisting home and business owners throughout Florida, Georgia, and South Carolina, we see a lot of claims. Our unique position allows us to witness recurring nightmare stories and identify trends in how insurance companies handle claims. These trends can be specific to individual companies or common across multiple carriers. In this case, we are seeing the same trend with several different insurance companies.

Common Issues with Sewer Back-up Limited Endorsement

Understanding the Endorsement

This trend revolves around the differences between a sewer back-up claim and a simple water damage claim. Although the title of this endorsement may vary from one insurance carrier to another, the implications are generally consistent. Most endorsements specify a special limit of insurance, typically around $5,000 or a small percentage of the building’s coverage, activated under certain conditions.

Policy Coverage for Back-up of Sewer or Drain

Here is an example of how one insurance company policy describes this coverage:

We will pay for accidental direct physical loss to the dwelling and covered personal property located within the dwelling, caused by the back-up of water or sewage, subject to the following: The back-up must be directly and immediately caused solely by water or sewage from outside the residence premises plumbing system that enters through a sewer or drain located inside the interior of the dwelling, or that enters into and overflows from within a sump pump, sump pump well, or any other system located inside the interior of the dwelling designed to remove subsurface water drained from the foundation area.”

For this endorsement to be properly applied, it would require that there was an issue with the sewer/drainage system off of the residence premises (beyond the property line) that then allowed water/sewage to back up into the property causing damage. This is typically due to some sort of problem with the sewer system at the street level or beyond. Not due to a blockage within the residence.

Initially, many adjusters, myself included, were trained to understand that it all depends if it is your own poopy water or your neighbors poopy water that entered your property. If it is your own water that was not able to drain properly due to a blockage or possibly a collapsed drain line and then overflows into the house, this endorsement should not apply as this is a standard water claim due to failed plumbing system. However, this endorsement would be properly applied in the event that there is an issue off of the property and other peoples poopy water is now backflowing into your property causing damage. 

Misapplication of the Endorsement

Incorrect Claims Handling

The problem we observe is that this endorsement is frequently misapplied to nearly all types of water damage originating from the drain lines. The situation we often see is where there is a blockage or collapsed drain line which causes water to overflow into the property causing damage. This situation should not fall under the “Back-up of Sewer or Drain” endorsement. These are more accurately described as blockage or overflow claims and should be handled as a simple water damage claim.

Advocating for Fair Treatment in Insurance Claims

The Importance of Persistence and Knowledge

If your insurance claim is denied or underpaid, consider it a starting point rather than a final decision. Insurance policies are complex, and every word counts. If you believe you’re not being treated fairly, seek a second opinion from an experienced Public Adjuster or an attorney specializing in First Party Property claims. Remember, knowledge is power, and you deserve no less than what you are entitled to under your policy.

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Greg Roover

Owner - Claim Concepts

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