Does Homeowners Insurance Cover Termite Damage?

Termite damage can be a huge problem for homeowners. Unfortunately, termite damage usually isn’t covered by homeowners insurance policies, as termite infestations are usually deemed as preventable.

In case you’re wondering why termite damage isn’t normally covered by home insurance, I can clarify the matter for you. Having spent more than twenty years helping consumers gain a better understanding of insurance, I can explain this for you. Keep reading to learn why home insurance doesn’t usually cover termite damage.

There are rare exceptions when your home insurance carrier might provide coverage for termite damage.

• If unseen termites chew through the electrical wires in your home, including the attic, and start a house fire, your home insurance may cover the damage since it was an accidental event.
• If your roof or part of your roof collapses due to hidden termites gnawing the wood, your insurer might pay for the resulting damages.

Insurers also hold the opinion in most scenarios that termite control should be considered a part of routine maintenance and the responsibility of the homeowner, not the insurance company.

However, there are two basic exceptions to this exclusion:

1. The termite damage is the result of a covered peril.
2.  If your home collapses completely due to termite damage.

Let me explain these instances where termite damage may be covered in a little more detail.

So, let’s say that your home insurance offers coverage for extreme weather events such as storms, fires, tornadoes and other covered perils. Since the main cause of a termite infestation is moisture and/or water, and these risks present a scenario where water could accidentally enter your home, including the water from fire hoses in the event of a house fire, an insurer might pay your claim for termite damage.

If your home completely collapses because of termite damage that was hidden until it suddenly destroyed your house, your homeowners insurance might cover the termite damage that caused the collapse along with any other costs associated with the collapse. You should know that “sudden collapse” means exactly that: collapse. In order for an insurer to cover termite damage and resultant damages, your house must fall to pieces, literally.

Shrinking, sagging, cracking, bulging, bowing, or expanding of your house due to termite damage are not covered.

The most important piece of information about your homeowners insurance and termite damage is that in all probability, your policy will not pay if they deem the damage preventable.

When Will Your Homeowners Insurance Cover Termite Damage?

Expanding a bit more on circumstances when your homeowners insurance might pay a claim for termite damage, here are some situations where you may be covered.

• Provided that the termite damage is caused by a sudden, accidental occurrence that was not preventable, meaning that it wasn’t due to neglect or negligence on the homeowner’s part, it might be covered.
• Hidden Damage: For instance, unseen termites could chew through electrical wires and cause a fire which spreads to the roof, or termites might gnaw through the wood of the roof and rafters, causing a leak that would rot the wood and cause the roof to collapse. In these types of events where the termites as well as damage are hidden, you couldn’t reasonably be expected to have prior knowledge of the termites or to have prevented the problem, so your homeowners insurance would probably cover the damages.

Now, here’s the tricky part to these events being covered by your home insurance: You have to connect the dots when filing your claim. In other words, you must show that the termites were a result of a tree falling on the roof or hail causing holes in the roof which let water in and caused the termite problem.

What this means is that you must file a claim for the initial damage first, before filing a claim for termite damage.

When Is Termite Damage Not Covered By Homeowners Insurance?

We’ve looked at some types of termite damage that are usually covered by home insurance. Now we can look at some aspects of termite damage that are not covered.

As a general rule, home insurance policies won’t cover termite damage that was able to be seen by the homeowner, and taken care of before any major damage was done. Signs of termites include:

• Pellet droppings that usually look like sawdust or coffee grounds
• Discarded wings, which might herald a new colony of termites
• Uneven or bubbled paint or wallpaper
• Blistered wood that appears splintered or carved
• Hollowed or soft wood that has a hollow sound when tapped
• Small tunnels or mud tubes about the width of a straw that begin at the foundation of the exposed wood and winds up the walls in a sort of vining pattern

If the insurance provider determines that the termite damage was gradual, happening over a period of time, and that it should have been noticed and measures taken to eradicate the termites before much damage occurred, it’s highly unlikely they’ll be willing to extend coverage.

According to the NAIC, (National Association of Insurance Commissioners) termite damage is not usually covered by home insurance. The reason is that infestations such as termites are normally considered preventable by insurance providers, and homeowners insurance is meant to cover sudden, unexpected events that couldn’t have been prevented.

So, if your house has wood damage that was caused by termites, but it isn’t affecting any system, or contributing to a sort of damage that is covered by your home insurance policy, you almost certainly won’t have coverage.

What To Do If Your Home Has Termite Damage?

First, assess the damage and try to get at least a ballpark figure of how much it will cost to repair or replace what has been damaged by termites. You may have to call in pros to give you an estimate of the price to fix it.

Next, determine whether or not the termites appeared due to a covered peril, such as a tornado tearing shingles off your roof which allowed water in, and termites along with it. Many insurers will cover termite damage if it’s the result of an event that is covered in your policy. Remember, though, that you must file a claim for the initial damage first, before filing a claim for the resulting termite damage.

In the event that your termite damage is not going to be covered by your home insurance, you’ll either have to hire a professional outfit to come in and get rid of the problem, or go the DIY route.

If you decide you can take care of the termites yourself, it’s important to make an accurate assessment as to the size of the infestation. The thing is that if you fail to wipe out the whole colony, the termite damage will keep growing, becoming increasingly expensive as well as damaging.

Yes, it will be cheaper to do it yourself, but if you have a big enough termite problem, it may be wise to consider hiring professionals to come in and do the job. They have the knowledge and the equipment to wipe the colony out completely and stop the infestation with no risk of it coming back. In which case, it would be less expensive to let them do it.

Are There Measures You Can Take To Avoid Termite Damage?

Yes, there are measures you can take to prevent or lessen the chances of termite damage.

One of the most important preventive measures you can take is to inspect your home thoroughly and often for problems that could lead to termites. For instance, since termites are attracted to moisture, if you have a leaking water pipe in the basement, stop the leak and let any wet wood dry out before termites move in.  Here are some more suggestions to help prevent a termite infestation:

• Check your gutters routinely to make sure they aren’t clogged and letting melting snow and ice or rain water overflow onto your roof, which could cause rot that would, in turn, bring termites.
• Inspect often for mildew, mold, damp spots or a musty smell inside your home as any of these could be the sign of a leaking roof.
• Don’t stack firewood or other wood next to your house, as wood is a termite magnet, especially wet wood that is outside exposed to the elements.
• Inspect and seal any potential entry points for termites such as cracks in the foundation of your home.
• Have gutters and downspouts to divert water away from the structure of your house.
• Don’t have soil or mulch around any parts of your house that is made of wood.
• Have your home inspected by professionals at least once a year to check for termites.

When To File An Insurance Claim For Termite Damage?

The major factor in deciding whether or not to file a claim for termite damage is whether or not the claim will be paid. As I’ve pointed out, rarely will termite damage be covered under a home insurance policy. However, if the termite damage is the result of a covered peril such as fire or a storm, you may want to file a claim and should have a decent chance of it being paid.

The other determining factor will probably be cost. If it’s a small infestation which you discovered in time to prevent much damage, even if it is the result of a covered peril; you may want to think twice before filing a claim for it. Unfortunately, filing claims often leads to a hike in premiums. So, if the cost is minimal, especially if you can do the job yourself, you might be shooting yourself in the foot to file a claim as it will cost you more in the long run.,

But, if it’s a large infestation that was hidden for a lengthy period of time before you realized the termites were there, it could cost upwards of $10,000 for the professionals to come in and eliminate the entire colony. In that case, and only if you’ll have coverage from your insurer, filing a claim would be a wise move.

How Do You File An Insurance Claim For Termite Damage?

If you do file a claim for termite damage, you’ll find that it’s much the same as filing any other type of insurance claim.

Here are the steps you should to take to file a claim for termite damage:

1. Read through your homeowners insurance policy to see what your coverage encompasses as well as the maximum coverage provided for termite damage, if any.
2. Document everything that relates to the termite damage. This will include such information about the covered peril that caused the termite damage and for which you have already filed a claim. Take photos of the termite damage, along with damages from the event that caused it, if possible. Make copies of estimates, receipts or invoices for labor and materials needed for repairs, and contracts.
3. Notify your insurance carrier of the incident. They’ll send an adjuster to look over the damage and determine whether your policy will cover it or not. The adjuster will provide an estimate of the cost of repairs.

That’s about all you’ll need to do until the repairs are made. At that point, you’ll pay any deductible and collect the payment from your insurer. Be mindful of the fact that you won’t collect any money until you have met your deductible.

Are Other Types Of Coverage Available For Termite Damage?

There may be other coverage options available in the event that termite damage is an exclusion in your home insurance policy.

Endorsements, often referred to as riders, are modifications to your insurance policy, changing your coverage. For example, if your policy excludes coverage for termite damage, and you purchase optional coverage that adds to your home insurance protection so that coverage is provided it; that is an endorsement.

Separate insurance policies for termite damage are not an option. However, there are other steps you can take to protect yourself from bearing the brunt of the cost of repairs if you have termite damage.

One of these steps is to have a Termite Bond. This is a service agreement that is between you and a pest control company.

Termite bonds provide you with regular inspections, and treatment if needed, to prevent or address infestations of termites. Termite bonds aren’t insurance, but they will offer protection on an ongoing basis by extermination of any termite colonies plus a savings to you in the cost of treatment.