1. Forms
2. HO
3. HO-06-95

What the form is

The HO 06 95, Broadened Water Back-Up and Sump Discharge or Overflow Coverage, is an endorsement to an ISO Homeowners policy. Its primary purpose is to provide or broaden coverage for direct physical loss to property caused by water or waterborne material that backs up through sewers or drains, or that overflows or is discharged from a sump, sump pump, or related equipment. A key feature of this endorsement is that it removes the requirement found in the more limited HO 04 95 endorsement that the water must originate 'within the dwelling' for coverage to be triggered. This endorsement allows the policyholder to schedule a specific limit of liability for this coverage.

Classes of business it applies to

This endorsement is designed for personal residential properties covered under an ISO Homeowners policy, such as:

• Single-family homes (typically on HO 00 02, HO 00 03, HO 00 05)
• Condominium units (HO 00 06)
• Tenants in rented dwellings (HO 00 04)

It is particularly relevant for homeowners whose properties:

• Have basements or crawl spaces equipped with sump pumps.
• Are located in areas with aging sewer infrastructure or where sewer backups are a known risk.
• Have significant value in below-grade finished areas or stored personal property.

Real-world example: If a municipal sewer line becomes overwhelmed during a heavy rainfall (but not a flood as defined by the NFIP) and sewage backs up into a home's basement through a floor drain, the HO 06 95 endorsement, if attached to the policy with an adequate limit, would provide coverage for the resulting damage to the dwelling and personal property, up to the scheduled limit. Another example would be if a sump pump fails due to mechanical breakdown, and water that would normally be pumped away from the foundation overflows into the basement.

Special considerations

• Scheduled Limit: The insured must select a specific limit of liability for this coverage, which will be shown on the endorsement or Declarations. This limit is separate from other property coverage limits (Coverage A, B, C, D).
• Distinction from Flood Insurance: This endorsement does not cover damage from flood (as typically defined in insurance, e.g., surface water, overflowing bodies of water). It specifically addresses backup from sewers/drains and overflow/discharge from sumps.
• Exclusions Still Apply: While broadening coverage, the endorsement is still subject to other policy exclusions. For instance, if a widespread flood causes the sump pump to be overwhelmed and discharge water, the flood exclusion in the main policy might still apply to deny coverage for the flood-induced discharge. The endorsement clarifies that the water damage exclusion in the base policy applies to backups and overflows, meaning the endorsement provides coverage for these perils from other causes of loss.
• Availability: Both the HO 04 95 (Limited Water Back-up) and the HO 06 95 (Broadened Water Back-up) endorsements may be available from insurers, with the HO 06 95 offering more extensive coverage by removing the 'within the dwelling' trigger.

Key information for agents and underwriters

• Risk Assessment: Underwriters should evaluate the property's susceptibility to water backup or sump overflow. Factors include the age and type of plumbing, presence and maintenance of a sump pump, history of such losses in the area or at the specific property, and whether the home has a basement.
• Coverage Recommendation: Agents should proactively discuss this coverage with clients, especially those with basements, sump pumps, or valuable property in lower levels. Explain the limitations of standard homeowners policies regarding water backup and how this endorsement can fill a critical gap.
• Limit Adequacy: Assist clients in selecting an appropriate coverage limit. This should consider the potential cost to repair or replace damaged portions of the dwelling (e.g., finished basement walls, flooring) and personal property.
• Clarify Coverage: Ensure the insured understands what is and isn't covered, particularly the distinction between water backup covered by this endorsement and flood damage, which requires a separate flood insurance policy.
• Pricing: The premium for this endorsement will depend on the limit of liability selected and the insurer's assessment of the risk.