The recent floods in Calgary and Toronto have brought considerable attention to the water damage coverage and exclusions of most home insurance policies. Water damage represents approximately 40% of all eligible home insurance claims, and costs the Canadian insurance industry just under $2 billion annually. While most home insurance covers water damage, there are two significant situations excluded in a standard policy: flood and seepage.
A flood, according to the Insurance Bureau of Canada, is defined as water flowing overland and entering your home through windows, doors and cracks. This is surface water on what would otherwise be dry . . . [more]