Homeowners Insurance Cover Foundation Repairs?

Page Summary

• Homeowners insurance may pay for foundation repairs when damage is tied to a covered, sudden event, and repairs are completed by properly licensed, bonded professionals.
• Many foundation problems are commonly excluded because they develop over time from drainage issues, soil movement, aging materials, or construction defects, and coverage limits vary by policy and endorsements.
• Early inspection, accurate documentation, and guidance from a qualified foundation repair contractor or structural engineer helps homeowners confirm the cause of damage, estimate costs, and avoid denied claims.

Foundation damage is stressful because it affects safety, resale value, and repair costs, and it often raises the same question right away: homeowners insurance cover foundation repairs, or are you paying out of pocket. The practical answer depends on what caused the damage, how long it has been developing, and what your policy lists as covered perils versus exclusions. In Arizona, where soil movement, drainage patterns, monsoon rains, and temperature swings can all affect slabs and stem walls, the cause of the problem matters as much as the crack itself.

If you are seeing interior drywall cracks, separation around windows, sloping floors, sticking doors, or step cracks in masonry, the next step is to confirm the source. Insurance adjusters and contractors look for a clear link between the damage and a covered event, such as a sudden plumbing leak, versus gradual settlement, poor grading, long term moisture intrusion, or wear and tear. When the cause is documented correctly, you can make better decisions about a claim, a repair plan, and how to protect the home going forward.

Homeowners Insurance will cover foundation repair costs if licensed and bonded contractors do them. Repairs made by non-licensed or bonded contractors can result in additional expenses for the buyer. In some cases, the additional costs will be higher than the actual cost of the repair. Therefore, buyers should do their homework before they contract with any contractors.

When homeowners discover they need to make repairs, many ask what is covered. Some individuals think that they are covered for damages if it is not their house that gets damaged. However, in the case of a sinking foundation, the home is not the only building that suffers damage. The foundation can also damage the surrounding buildings, causing property devaluation. This means that homeowners who call in the professionals must also pay for damage to the surrounding properties.

What are some examples of common foundation issues? Sanding is often required when repairing foundation cracks. Homeowners can hire contractors to remove the sand around the foundation while the repairs occur. Homeowners may have to pay an additional fee for the removal of the sand since it will be assessed as a part of the repair costs.

What should buyers consider when it comes to the issue of past foundation repairs? Homeowners should research any contractors that they may be considering for their homes. There are important questions buyers should research to determine the experience of the contractors they plan to hire. The best way to start is to ask friends and relatives for referrals of good contractors they have worked with. For instance, if a friend has gotten a great deal on foundation repair work, the contractor should be considered if the work was satisfactory. Additionally, people who have recently had foundation repair work performed on their homes will likely recommend that particular business to others.

Homeowner’s insurance covers foundation repairs for several reasons. One reason is that many damage incidents occur below the house, causing foundation damage often not covered by standard home insurance policies. Another reason is that poor drainage is a common cause of foundation damage. Poor drainage causes rainwater to splash or spill onto the home’s surfaces, damaging the foundation. A good contractor can repair this damage.

According to the American Society for Testing and Materials (ASTM), if the home is older than 15 years, the majority of foundation issues will not require repairs. Foundation issues over fifteen years old must be evaluated for removal, replacement, or repair. However, there are instances where repairs may be required. For example, seepage can occur below the house due to age or improper construction.

Homeowners’ insurance companies typically do not include basement or crawl space foundation repairs in homeowners’ insurance packages. Foundation cracks, holes, and other issues that affect the foundation must be sealed. A basement or crawl space seepage can be very hazardous, especially when sewage or chemicals come into contact with the soil. An example of a seepage could be sewage backing up into a basement and filling the air with cancer-causing gases.

Typical contractors quote homeowners about one hundred dollars per foot for foundation repair services. Some contractors quote even less but are usually experienced contractors with much experience sealing and repairing foundation problems. A simple solution can save the homeowner hundreds of dollars on typical repair costs. This simple solution is to cover the cost of the service out-of-pocket.

Many homeowners want to make repairs themselves because they are afraid that a company will mark the cost of the service up to make a profit from the service. Unfortunately, this is often how contractors make their money. If a homeowner quotes a company and the estimate is more than they can afford, they simply take the money and use it somewhere else. Without providing any type of benefit to the buyer, the company makes no profit. On the other hand, if the estimate is too low or the contractor does not charge a decent amount for labor, the buyer has nothing to lose and everything to gain.

Homeowner’s insurance covers foundation cracks, sagging walls, and other issues that can cause excess foundation damage. The majority of damage caused by settling of the structure is not actually due to settling but is due to the foundation settling, causing cracks in the wall or flooring. Homeowners often try to solve their own foundation damage by cementing or planking over the damage. Unfortunately, cementing and planking only cover up the problem temporarily. Eventually, the moisture will build up behind the cemented surface, and the structure must be remodeled from top to bottom. Homeowners who do not learn to properly repair foundation damage caused by settling do not make the necessary repairs, which will ultimately cost them more in the long run.

Home buyers should also learn how to do a foundation inspection independently. With a simple inspection, they can see if the foundation is level and damage-free. By learning how to do a foundation inspection, the potential to save money on the homeowner’s insurance premium can become a reality. If the damage caused by settling cannot be repaired, then it is time to contact a structural engineer who will determine the best course of action.