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There are two ways to discover that your water main is leaking: slowly, and suddenly. The slow way is when you notice that your water bill keeps creeping higher, and that one part of the lawn seems to be growing much faster than other parts. The fast way is when you see a new brook bubbling up gaily in your azaleas. Either way, you could have a major household repair at hand.
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Your homeowner's insurance likely won't cover water pipes outside your house, and your friendly local water utility won't come out and fix it for free, either. The average cost to replace your main water line is $3,750, according to Fixr.com. You can get coverage against water line breaks. Should you?
How water line coverage works
Your utility company probably offers “insurance” against water main breaks. Typically, these are home warranty contracts, not insurance, and they are usually offered by a third party, not the utility itself. This is a common arrangement: Most utility companies don't want to repair water lines, and they get a cut of the contract cost from the home warranty company.
For example, CenterPoint Energy advertises a service repair contract for water line breaks for $5.99 a month, which is added to your gas bill if you choose to accept the contract. National Home Repair Warranty is the issuer of the service contract, which is administered by a third company, HomeServe USA Repair Management Corp.
The contract typically covers the water line from the edge of your property to the outside wall of your house. In most cases, plumbing inside your house is covered by homeowner's insurance unless the leak has been caused by neglect. If you have a well, the coverage typically runs from your home's outer wall to your well casing.
The water line contract isn't an insurance policy, but it will have exclusions. Read them carefully. For example, there's often a 30-day waiting period before the contract goes into effect. Pipes broken by natural disasters, such as earthquakes, won't qualify.
For tips on building an emergency fund to help cover unexpected home repairs, check out the AARP Money Map.
Is water line coverage worth it?
For a limited number of people, it can be. First, barring some very shoddy plumbing work, water mains tend to last a long time — typically 50 years or more. If you have a new house, a water line leak is unlikely, and you probably don't need a warranty contract. “If your water main is 50 years old or more, you're probably rolling the dice a bit,” says Jason Kiddy, an engineering consultant in Gambrills, Maryland.