Will insurance pay for the water damage? How Texas policies treat leaks and mold

Sudden, gradual or flood: the distinction that decides coverage

In general, Texas homeowners policies cover water damage that is sudden and accidental, such as a burst pipe, a toilet overflow or a broken washing machine hose, and usually do not cover damage from slow, gradual leaks or from flooding, which needs a separate flood policy. That is how the Texas Department of Insurance summarizes it. Mold is covered in some situations and excluded in others, and every policy has its own wording, so treat this as general information and confirm the details with your agent or adjuster.

We are SERVPRO of Park Cities. Juan and I own the company, and most of the water losses we handle in Dallas, Highland Park and University Park go through an insurance claim. I am not an insurance agent and cannot tell you what your policy covers. What I can share is what Texas consumer guidance says and what we see make claims go smoothly or go sideways.

What sudden and accidental looks like in practice

The Texas Department of Insurance gives examples of the kind of event most homeowner and renters policies cover: a burst pipe, a toilet overflow, a broken washer hose. The common thread is that something failed suddenly and water escaped all at once or over a short time. A water heater that ruptures, an ice maker line that splits and a supply line that lets go behind a vanity are the kinds of losses we see every week.

Gradual damage is different. TDI notes that policies usually will not cover damage from gradual leaks. A slow drip under a sink that rotted the cabinet base over months, a shower pan that has been seeping into the subfloor for a year, or a roof leak that stained the ceiling a little more with each rain may be treated as maintenance problems rather than sudden losses. That is why catching small signs early matters, which I cover in how to spot hidden water damage behind walls and floors.

• Usually covered: burst pipes, toilet overflows, broken washer hoses and similar sudden failures
• Usually not covered: slow, long-term leaks and seepage
• Not covered by a standard home policy: flood, which needs a separate flood policy
• Depends on the cause and the policy: mold

Flood is not the same as water damage

To an insurer, flood generally means water coming into the house from outside, such as rising water from heavy rain or an overflowing creek. TDI is clear that standard home policies do not cover flood damage and that you would need a separate flood policy. TDI's disaster claims FAQ adds that mold resulting from a flood would not be covered either, because home policies do not cover floods.

If you live near a creek or in a low area, check whether you have flood coverage before you need it. If you do not know, your agent can tell you, and a property and casualty agent such as the author of this guide to handling a homeowners renewal increase can explain the trade-offs of adding it.

Where mold fits into a water claim

Mold coverage depends on how the mold got there. According to TDI, if mold develops on an item damaged by a covered water event, it would be covered. But most home policies do not include mold cleanup and testing after a damaged item is removed, and they generally do not cover mold resulting from gradual leaks. TDI also notes that you may be able to add mold coverage to your policy.

The practical lesson is speed. Water that is extracted and dried quickly rarely becomes a mold problem in our experience, which keeps the claim simpler. TDI's guidance says to remove pools of water and start drying the area to prevent more damage and mold growth, and to hire a service if you cannot dry it yourself. If mold work is needed, TDI also advises making sure the mold professional holds a Texas license.

If a slow leak has already caused mold, report it anyway and let the adjuster decide. Coverage questions are the insurer's call, and a claim you never report is a claim that can never be paid.

Seven habits that keep a claim on track

Most claim problems we see come from steps skipped in the first few days, not from the policy itself. These habits come straight from TDI's consumer guidance, plus what we have learned from documenting losses for adjusters.

• Report promptly. TDI says you usually must report water damage that was hidden from view within days after you first see it.
• Photograph and video the damage before making any repairs.
• Do not throw away damaged items until your adjuster has seen them or your insurer says it is fine.
• Make temporary repairs to protect the house, such as stopping the leak and drying the area, and keep receipts for everything.
• Do not make permanent repairs until your insurance company has seen the damage.
• Keep a list of everyone you talk to at the insurance company, with dates.
• Be available for the adjuster's visit so you can make sure they see everything.

Why drying should not wait for the adjuster

One of the most expensive misunderstandings we see is a homeowner who leaves wet carpet and drywall in place for a week because they are waiting for the adjuster to visit. TDI's guidance points the other way: stop the leak, remove standing water and start drying to prevent more damage and mold growth, while saving the evidence your insurer needs. Emergency drying is the kind of temporary repair that protects the house.

The way to do both is documentation. We photograph the damage before anything is removed, take moisture readings, and record what was taken out and why, so the adjuster can see the loss as it was even after drying has started. We provide that information about the services we performed to support your claim. If you are still in the first hours of a leak, my guide to the first 48 hours after finding standing water walks through the order of operations.

Keep the part that failed

If a supply line, valve, water heater or appliance failed, keep it. Do not let anyone throw it away. When another party may be responsible, such as a manufacturer, an installer or a neighboring unit, your insurer may want to pursue them after paying your claim, a process called subrogation. The failed part is often the key evidence. Some of our staff have completed subrogation claims training, so we know to bag, label and photograph the failed component instead of tossing it with the debris.

The same goes for anything the adjuster may want to see: sections of removed drywall or flooring, a ruined rug, damaged contents. TDI's guidance is not to throw away damaged items until your adjuster has seen them.

Living expenses, mortgage checks and deductibles

If the damage makes the house unlivable for a while, ask about additional living expenses early. TDI's disaster claims FAQ notes that your homeowners or renters policy may pay for a hotel or rental, subject to the limits in your policy, so keep receipts for those costs too.

Contents are a separate part of most claims. Make a room-by-room list of damaged belongings with photos, and keep the items until your adjuster has seen them. If we pack out contents for cleaning, our inventory and photos become part of that record.

If you have a mortgage, the insurance check for repairs may be made out to both you and your lender. TDI notes that the mortgage company must get in touch with you within 10 days of getting the check from your insurer. Expect the lender to have its own process for releasing funds as the work progresses.

Finally, your deductible is yours to pay. TDI states that it is illegal to waive a homeowners deductible under Texas law, so be wary of any contractor who offers to cover it.

Read these lines of your policy on a quiet day

The best time to learn how your policy treats water is before anything leaks. Pull out the declarations page and the policy itself, or ask your agent to walk you through them, and look for a few specific items. None of them are hard to find once you know they matter, and each one changes what a future claim looks like.

Write down what you find and keep it with your claim line and your agent's number. If anything surprises you, such as a very high deductible, no water backup coverage or a low limit on living expenses, that is a conversation to have with your agent now, when you can still change it, rather than after a pipe has burst.

• Your deductible, and whether any part of it is a percentage rather than a flat dollar amount
• Whether water backup from sewers and drains is included or available as an endorsement
• Any limit or exclusion for mold, and whether added mold coverage is available
• The limit for additional living expenses if you have to move out
• How contents are valued, replacement cost or actual cash value
• Whether you have a separate flood policy, and what it covers

When you call us with a claim in progress

Tell us whether you have already filed and, if so, the claim number and the adjuster's name. If you have not filed yet, we start mitigation to keep the damage from growing and document everything from the first visit, while you report the loss. We keep you and your adjuster informed with photos and readings throughout the drying.

When the structure is dry and the scope is agreed, our reconstruction team rebuilds, so the claim follows one continuous record from the first photo to the final walkthrough. I explain why that helps in one company or separate contractors after a loss. If your damage came from a storm rather than plumbing, start with securing the house after a storm. And for any question about what your policy actually covers, talk to your licensed agent.

Questions people ask me