Of the hundreds of apartment insurance claims Gotham Brokerage processes every year for NYC renters and co-op and condo owners, well over half are prompted by water damage—and not the Hurricane Sandy kind either.
“Water damage from burst pipes, overflowing sinks, toilets, and heating and cooling units are far and away the most frequent claims,” says Gotham’s president Jeff Schneider. “The average claim size usually starts at a couple of thousand dollars up to the low five-figures, which is many, many times the annual cost of apartment insurance.”
Here are the three most common water damage claims in NYC—and how much they’ll cost you if you don’t have insurance:
Burst pipes: “In New York City, in 50- to 60-year-old buildings, and older ones, this happens a lot,” says Schneider. “A pipe suddenly gives way for no apparent reason. In most cases, it’s no one’s fault—you just wake up in the morning and a pipe has broken in your wall and all your stuff is soaking wet.”
If you’re renting, your landlord has to pay to fix the leak, floors and walls, but you’re responsible for your stuff. The average claim size is $2,500 to $5,000, so a $15-per-month basic renters insurance policy can pay off in spades. Co-op and condo claims are usually double that—in the $5,000 to $10,000 range, including repairs to floors and walls, says Schneider.
Note: While frozen pipes are not normally an issue in apartment buildings, they can become one in polar vortex-type weather like New York recently experienced.
“We had several claims where plumbers had installed pipes in uninsulated exterior walls, and they froze and burst,” he says. “It’s a mess and usually a big job to fix.”
Sink, toilet & tub overflows: “Kids leave things in toilets or sinks that clog them up, or people just forget the water is running,” says Schneider.
Ironically, water shut-offs frequently lead to flooding.
“The building temporarily shuts off the water, a resident tries to turn it on, then accidentally leaves the valve in the open position and goes out all day, and the drain can’t handle the water,” says Schneider. Water damage is often extensive, with claims averaging $5,000 to $10,000, not including havoc wreaked on the apartment beneath, says Schneider, which is also covered by insurance.
Keep in mind that if you’re a renter, you may be on the hook for just as much money as a co-op owner, since this type of flooding is due to your own negligence, says Schneider. Fortunately, apartment insurance, if you have it, will cover you anyway.
Dripping heating and cooling units: Blocked condensation tubes in heating and cooling units can leak, often in a sneaky manner that goes unnoticed for some time--buckling wood floors, sending water into downstairs’ neighbors apartments, and potentially creating a mold problem.
The average claim size is around $2,000 for a renter and a “very substantial multiple” for a co-op or condo owner—from $2,500 to $50,000 or more, says Schneider.
“If you’re in a very nice co-op or condo, you could see a six-figure claim from water damage that’s gone unnoticed,” says Schneider. “We currently have a mid-six-figure claim where someone had what seemed like a very minor leak from their apartment but it allegedly caused a mold situation below—requiring an eight-month long gut renovation to fix.”
Gotham Brokerage Co., Inc., an insurance brokerage, has been serving NYC renters, co-op and condo owners for over 45 years. For a free quote, click on over to Gotham Brokerage or give them a call at 212-406-7300.
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