December is a good month to read your homeowner policy. Freeze season is ahead, the document is probably sitting unread in an email or a drawer, and the terms inside it decide how a water loss will be handled long before anyone calls an adjuster. This is a plain-language glossary of the terms that come up most on water claims. It is general information, not coverage advice; your policy and your carrier govern your claim, and your agent can explain how any of these apply to you.
Sudden and accidental
The phrase that most water coverage turns on. A burst pipe, a failed supply line, an appliance hose that lets go, a water heater that ruptures: these are sudden and accidental discharges, and they are commonly covered. The damage did not build up over time, and no one could reasonably have caught it earlier.
Continuous or repeated seepage
The other side of the same coin. Most policies exclude damage from leaks that continued over a period of weeks or months, and from deferred maintenance. A slow drip under a sink that rotted the cabinet floor over a year is usually excluded, even though the damage looks the same as a covered loss. This is why finding and fixing small leaks quickly matters for coverage as well as for the house.
Flood, surface water and groundwater
Standard homeowner policies exclude flood, meaning water that rises from outside the home: overflowing creeks, street runoff, water entering at ground level during a storm. Flood coverage is a separate policy, typically through the National Flood Insurance Program or a private flood carrier. Water coming through a storm-damaged roof, by contrast, is generally handled under the wind and hail portion of a standard policy because the roof damage is the cause.
Sewer and drain backup
Water backing up through a drain or a sewer line is commonly excluded from the base policy and added back by endorsement. If your home has a basement, a slab drain or older sewer laterals, ask whether you carry it. Our post on sewage backups explains why that water is treated as Category 3.
Deductible
The amount subtracted from the settlement. Many Texas policies now carry percentage deductibles for wind and hail, often 1 or 2 percent of the dwelling limit, alongside a flat deductible for other perils. Know which applies to which kind of loss.
Actual cash value and replacement cost
Actual cash value (ACV) is the cost to replace an item minus depreciation for age and wear. Replacement cost value (RCV) is the cost to replace it new. Many policies pay RCV on the dwelling but may initially release only the ACV, holding back the recoverable depreciation until repairs are completed and invoiced. Contents are sometimes covered at ACV only unless you have purchased replacement cost coverage for personal property.
Sublimits
Caps within the policy for particular categories. Mold is the one that matters most on water claims: many policies limit mold-related remediation to a fixed amount regardless of the dwelling limit. Jewelry, firearms, collectibles and business property often carry sublimits under contents.
Loss of use, or additional living expense
If the home is not habitable during repairs, this coverage pays for reasonable additional costs of living elsewhere: a hotel, a rental, extra mileage or meals. It is separate from the dwelling and contents limits and has its own cap and time period.
Ordinance or law
Pays the added cost of bringing a repair up to current building code when the code has changed since the home was built, for example new electrical or plumbing requirements exposed during a rebuild. It is often a small percentage of the dwelling limit and is not included in every policy.
Duty to protect the property
Policies require the homeowner to take reasonable steps to prevent further damage after a loss. That is why starting mitigation immediately is not only good practice but part of your obligation. It is also why unheated, unoccupied homes during a freeze can create coverage questions; many policies require that heat was maintained or that water was shut off.
Where your contractor fits
Your restoration contractor does not decide coverage, but complete documentation of the cause of loss, the moisture conditions and the scope of work is what lets the adjuster evaluate the claim accurately. Our step-by-step walkthrough of filing a water damage claim covers how that process runs. If you have a loss and questions about the process, call Fire & Water Restoration Plus at 972-455-8252.