Like any other business, a plumber or plumbing company needs to be covered by insurance. Plumbing insurance can cover damage to your business property and provide liability protection in the event of an accident involving customers or employees.

But homeowners should also invest in plumbing coverage. A home warranty can supplement your homeowners insurance to provide comprehensive coverage for plumbing issues or system breakdowns. In this article, we at the Guides Home Team will explain what you need to know about plumbing insurance, including how much it costs and what it covers, from both a commercial and consumer standpoint.

When a homeowner is considering plumbing insurance, it likely fits into one of the following categories:

Each option has merit in the right situation, but the type of coverage you choose can go a long way in offering peace of mind with your plumbing system.

On the commercial side, plumbing insurance usually refers to a type of business insurance policy that provides coverage for plumbing companies and contractors. These policies can cover workers’ compensation, commercial auto insurance, commercial property protection, medical costs for employee injuries and other items related to running a business. Some coverages may be legally required depending on the nature of the business, while others policies are elective.

For homeowners, a commonly asked question is, “Does my homeowners insurance cover plumbing?” In many instances, the answer is no.

Home insurance is meant to cover sudden events like natural disasters, and many plumbing issues such as sewer backup, leaking pipes and water heater breakdowns don’t fall in that category. However, a burst pipe due to freezing temperatures or other uncontrollable events might be covered. The specifics will depend on your policy and how your provider defines covered perils.

Because of the nuance between plumbing and insurance exclusions, it may be easier to contact an insurance agent to see if your provider offers any plumbing coverage add-ons or explore a home warranty with plumbing coverage.

As for businesses — any company engaging in the plumbing business, whether that be in maintaining, installing or repairing plumbing or septic systems, needs to have specialized insurance to cover employees and the actions of those employees in the field. Even a small business or a one-person operation still needs coverage for workers’ compensation, professional liability and property coverage, among other things.

The cost of plumbing insurance will depend on your situation. For example, if you file a homeowners insurance claim for a plumbing incident that was not sudden or accidental, your provider might not extend full coverage. However, most homeowners policies include property coverage and dwelling coverage which could help pay for personal property or repair costs due to a plumbing breakdown or mishap.

If you want full coverage for a potential plumbing incident, even if it’s not sudden or caused by everyday wear and tear, a home warranty can help. Home warranties, on average, cost around $38 to $63 per month. This estimate is based on our research, secret shopping and review of the top home warranty companies.

Plumbing businesses can purchase multiple insurance policies from different providers or choose an umbrella policy from one company that covers many areas. On average, plumbers can expect to pay around $500 a month for complete insurance protection, which includes general liability insurance, workers’ compensation, loss of use coverage and various other policies.

Factors That Impact the Cost of Plumbing Insurance

Obtaining coverage for water or plumbing damage through insurance alone is not always possible. Homeowners insurance typically only covers sudden events, so if you have a faucet water leak or sewer line issue that slowly causes water damage over time, you might not be covered. However, you can supplement your insurance with a home warranty to fill any coverage gaps.

The price you’ll pay for your homeowners insurance or a home warranty is based on the following factors:

• Location: Both your home’s location on a map and proximity to emergency services and fire hydrants can impact your insurance cost.
• Deductible: As with any insurance, your deductible will impact your cost. The higher your deductible, the lower your premium rate, and vice versa.
• Personal information: Your marital status, claims history and credit score, among other personal variables also play a role in determining your monthly premium.
• Coverage selections: Different coverage options — like comprehensive policies or add-ons that enhance plumbing coverage — can increase the cost of your insurance.

As we have seen so far, complete coverage for plumbing issues is difficult to obtain if you are relying on homeowners insurance. A standard homeowners policy generally covers plumbing issues that are sudden or accidental events but does not include problems that arise over time.

With these points in mind, a home warranty is a great option for property owners looking for more complete coverage for plumbing issues. Check out the following table to compare plumbing coverage between homeowners insurance and a home warranty.

When it comes to commercial plumbing insurance, the main goal is to protect the business, employees, subcontractors and equipment in the event of an accident. For these reasons, business coverage does little to help a homeowner in the event of a plumbing issue.

Homeowners Insurance Plumbing Coverage

Homeowners policies are designed to cover events like fire, flood and theft, and plumbing components can certainly play a part in or be damaged by these events. Your homeowners insurance will include a list of covered perils in your policy terms. If damage to your plumbing system was caused by a covered peril, you are likely covered.

For example, if a pipe bursts from freezing weather, your policy will likely cover the cost of repairs. On the other hand, if a component of your plumbing system wears out or fails over a long period of use, your homeowners policy will likely not cover any resulting issues.

Home Warranty Plumbing Coverage

Home warranties can protect your home systems and appliances from normal wear and tear over time — and some companies extend coverage due to improper installation or maintenance. Generally, home warranty coverage applies to items that can break down over time, like water lines, toilets, faucets, shower heads and sump pumps. Home warranties even cover issues like clogs and stoppages in your home water or sewer lines.

Not every home warranty policy covers plumbing systems and damage. Review your service contract before purchasing coverage to be sure you know exactly what is and is not covered.

What Is the Best Plumbing Insurance?

Supplementing your current homeowners insurance policy with a comprehensive home warranty is the best way to protect your plumbing systems. Our recommended home warranty company for plumbing protection is American Home Shield. American Home Shield provides a range of coverage with four plan options, and you can customize your monthly premium by choosing a service call fee or deductible. The company covers all homes, no matter the age of your systems or appliances.

If you are a contractor providing plumbing services, consider exploring nationwide business insurance providers like The Hartford or Progressive to find the coverage you need.

Homeowners can benefit from home insurance or warranty coverage in the event of a plumbing emergency, but relying on one coverage method could result in out-of-pocket costs for some issues. Home insurance policies cover damage from sudden events like severe weather, fire and floods, whereas a home warranty covers issues due to everyday wear and tear. Because of this, using a combination of homeowners insurance and a home warranty will likely give you the most comprehensive plumbing insurance coverage.

Homeowners won’t benefit from a commercial plumbing insurance policy. These plans are designed for plumbing professionals to protect their businesses from lawsuits and accidental damage.

Sarah Horvath is one of the home service industry’s most accomplished writers. Her specialties include writing about home warranties, insurance, home improvement and household finances. You can find her writing published through distributors like HouseMethod, Architectural Digest, Good Housekeeping and more. When not writing, she enjoys spending time in her home in Orlando with her fiance and parrot.

Tori Addison is an editor with over five years of experience in the digital marketing industry. Her includes communications and marketing work in the nonprofit, governmental and academic sectors. A journalist by trade, she started her career covering politics and news in New York’s Hudson Valley. Her work included coverage of local and state budgets, federal financial regulations and health care legislation.