Food Damage: What's Covered By Insurance?

Food spoilage due to a power outage can be covered by your insurance, but it depends on the cause of the outage and the type of insurance you have. Homeowners insurance may cover food spoilage if it is the result of a covered peril, such as a tree falling on your home's roof and severing the power line. However, if the power outage is due to a DIY project gone wrong or unpaid power bills, your insurance policy will likely not cover food loss expenses. The coverage amount and deductibles vary, so it is important to carefully review your insurance policy or consult your insurance provider to understand the specifics of your coverage.

Home insurance covers food damage due to power outages

Home insurance policies vary, but they generally cover food damage due to power outages if the outage is caused by a covered peril. This includes events such as a lightning strike, a windstorm, or a tree falling and damaging a power line. The coverage is usually limited to $500 or $1,000, and a deductible will apply.

Some insurers will cover food spoilage caused by any power outage for an additional premium of $15 to $50 per year. This is known as a special endorsement.

If the power outage is caused by the power company, they may reimburse you for the cost of food spoilage. Some utility companies will also reimburse you for your deductible or other damage caused by the power outage.

It's important to review your insurance policy or contact your provider to understand the specifics of your coverage.

Food spoilage coverage varies by company

Some insurers' policies may cover food that spoils if the power outage affects only your residence, while other providers may offer coverage if the entire neighbourhood is without power. In either case, the outage would likely have to be caused by a covered peril.

If your refrigerator malfunctions for reasons other than a power outage, your home warranty might cover any food spoilage. Adding equipment breakdown coverage can increase your limit for food spoilage caused by power interruption or mechanical failure.

If your homeowners insurance doesn't cover a food spoilage claim, it's worth asking your utility company if they will reimburse you for the loss. Some utility companies will cover food spoilage, but only if the outage was their fault. Other utility companies might cover food spoilage to help customers who suffered a loss during a widespread event, such as a tropical storm.

Power companies may reimburse for food damage

Power outages can be a real headache, especially when they result in food spoilage. The good news is that power companies may reimburse you for food damage under certain circumstances.

When Power Companies May Reimburse for Food Damage

When Power Companies May Not Reimburse for Food Damage

On the other hand, power companies typically will not reimburse for food damage if the power outage is due to circumstances beyond their control, such as weather conditions or natural disasters. Power outages caused by earthquakes, wind, rain, fog, lightning, or extreme heat are generally considered exempt from reimbursement.

Factors Affecting Reimbursement

The cause of the power outage plays a significant role in determining reimbursement. If the power outage is due to a covered peril, such as a tree falling on a power line or a lightning strike, your insurance policy may cover food spoilage. However, if the power outage is due to non-payment of bills or accidental damage during a DIY project, reimbursement is less likely.

Steps to Take for Reimbursement

To increase the chances of reimbursement, it is essential to document the food loss with photographs and estimates of the expenses incurred. Additionally, retaining receipts for expensive food items can support your claim. It is also advisable to review your insurance policy or consult with your insurance provider to understand the specifics of your coverage, including limits and deductibles.

Home insurance covers food damage due to equipment breakdown

Equipment breakdown coverage is an optional add-on to home insurance policies that covers electrical or mechanical breakdowns of appliances and systems. This includes refrigerators and freezers, which, if they break down, can cause food spoilage. While equipment breakdown coverage does not apply to appliances that break down due to normal wear and tear, neglect, or poor maintenance, it can provide coverage for food spoilage resulting from a covered loss. For example, if a power surge damages your refrigerator, equipment breakdown coverage may pay for its replacement and any resulting food spoilage, up to the limits of your coverage and minus your deductible.

The cost of adding equipment breakdown coverage to a home insurance policy is typically between $25 and $50 per year, with coverage limits of up to $50,000 for any single occurrence. This additional coverage can provide peace of mind and financial protection in the event of appliance breakdowns.

Food spoilage claims can affect your insurance rates

Before filing a food spoilage claim, weigh the costs of your home insurance deductible. If the amount of food spoiled surpasses your deductible, then it may be worth filing a claim. However, if not, it may be best to just restock your fridge out of pocket. This is because the claim would go on your record, and with the typical homeowner's deductible at $500, the amount it costs to file the claim might exceed the value of the spoiled food.

If you do decide to file a claim, make sure you document the loss before you throw away the food. Here are some tips for filing a spoiled-food insurance claim:

• Make a list and take photos of the spoiled food
• Estimate the cost of the spoiled food
• Gather receipts for pricey items that were spoiled, like lobster and steak

Food spoilage coverage typically has a limit of $500, which is the maximum amount your insurer will pay out for food loss. However, some insurance companies may offer higher food spoilage coverage limits of up to $2,500 or more.

Frequently asked questions