Haris Ashley
Service line insurance is an optional type of insurance that covers the cost of repairing underground utility lines on your property, such as water, gas, sewer, electrical, and telephone lines. It is important to note that standard homeowners insurance policies typically do not include this coverage. The cost of repairing these lines can be expensive, ranging from $1000 to $4000 on average. Service line insurance provides financial protection and peace of mind for homeowners, but it may not be necessary for everyone. Some factors to consider when deciding if service line insurance is worth it include the age of your home, whether you have an emergency fund, and the likelihood of repairs needed based on your location and the condition of your utility lines.
| Characteristics | Values |
|---|---|
| Purpose | To pay for repairs to underground utility lines on your property |
| Covered utilities | Water, gas, sewer, electrical, telephone, cable |
| Cost | $15–$50 per year, depending on location and desired coverage |
| Advantages | Financial protection, convenience, peace of mind |
| Disadvantages | Exclusions vary across insurance companies, may not cover water wells, septic systems, or liquid fuel tanks |
| Alternatives | Maintenance fund, home warranty |
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What You'll Learn
Cost of service line insurance
The cost of service line insurance depends on several factors, including the location of your home, the insurance company, and the level of coverage.
Service line coverage is an optional type of insurance that pays for repairs to underground utility lines on your property. It typically covers water, sewer, steam, telephone, or cable lines. The cost of this coverage usually ranges from $20 to $50 per year, but some companies offer rates as low as $9 per year for newer homes.
Monthly rates for exterior water service line plans can range from $4.95 to $12.98, while exterior sewer/septic line plans can range from $7.99 to $12.98. Some cities offer a single exterior pipe plan covering both water and sewer lines, with prices ranging from $15.99 to $20.97 per month.
Service line insurance often comes with a deductible, which is the portion of a claim that you must pay. For example, if you have a deductible of $500 and a repair cost of $3,000, your insurance company would pay $2,500.
Some people view service line insurance as unnecessary, recommending building a maintenance fund instead. They argue that the likelihood of needing service line repairs is low, and the cost of insurance may outweigh the potential benefits.
However, others find peace of mind in having service line insurance, especially in areas with older pipes. The cost of repairs can be high, and insurance can provide financial protection and faster deployment of contractors.
Ultimately, the decision to purchase service line insurance depends on individual circumstances, the likelihood of repairs, and the potential financial impact.
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What does service line insurance cover?
Service line coverage is an optional type of insurance that covers the repair or replacement of underground utility lines on your property. These can include water, gas, sewer, steam, telephone, or cable lines. Service line coverage can also cover the cost of excavation and repairing underground wiring and piping. Some policies may also pay for damage due to wear and tear, root invasion, mechanical or electrical failure, blockage, bursting or collapse, rust or corrosion, disconnection, rodents or other animals, and more.
The cost of service line coverage depends on where you live, how much coverage you want, and the company you choose. It typically ranges from $9 to $50 per year, with some companies offering rates as low as $11 per month. Service line coverage often comes with a deductible, which is the amount of a claim that you will have to pay. For example, if you have a $500 deductible and a repair costs $3,000, your insurance company will pay the remaining $2,500.
Service line coverage is not mandatory, and it is important to carefully read the exclusions of your policy, as they vary from company to company. For instance, service line coverage generally won't pay to repair utility lines located above ground or water wells, septic systems, or liquid fuel tanks. Additionally, some policies have a waiting period before the contract goes into effect, and natural disasters such as earthquakes may not be covered.
Some people recommend having a maintenance fund instead of service line insurance, as the risk of needing underground utility line repairs is very low. However, others argue that the peace of mind that comes with service line coverage is worth the cost, especially considering that repairs can be expensive and unexpected.
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$52.95 $160
Is service line insurance a warranty?
Service line insurance is technically a warranty. A warranty is different from insurance in that it covers events that are likely to happen at some point in a product’s life, thanks to things like aging or wear and tear from normal use. On the other hand, insurance covers unexpected events. A service line warranty offers financial protection in the event of damage to or caused by your service lines. Service lines include the exterior utility pipes (or lines) that run underground and supply your home with a specific service, such as water lines, sewer lines, gas lines, and electricity.
Service line warranties work similarly to insurance policies. You pay a company for financial protection against events covered by your warranty. However, instead of coverage limits, warranties have annual benefit amounts, which are the maximum amount of protection your warranty company will cover in a year. For example, a service line plan with an annual benefit amount of $5,000 will only cover up to $5,000 worth of repairs and/or damages in a year. The cost of a service line warranty plan will depend on several factors, such as where you live, which company you buy coverage from, and how much coverage you get. Many utility companies across the country partner with third-party companies to sell service line warranties.
Service line coverage is an optional type of insurance that can pay for repairs to underground utility lines on your property. It generally won't pay to repair utility lines located above ground. Because the coverage is designed for utility lines that link your home to a municipal or commercial service, it may not cover damage to water wells, septic systems, or liquid fuel tanks. The cost of service line coverage depends on where you live and how much coverage you want. A typical range is $20 to $50 per year, but some companies advertise rates as low as $9 per year for newer homes. Service line coverage often comes with a deductible—the amount of a claim you'll have to pay.
While some people recommend service line insurance for peace of mind, others argue that it is unnecessary. Money expert Clark Howard advises against service line insurance, stating that it is better to have a maintenance fund that you contribute to regularly rather than insuring individual things. He suggests that the risk of needing service line insurance is very low and that it is better to have broad insurance coverage rather than specific insurance for individual items. Instead of paying for service line insurance, you can consider adding service line coverage to your homeowners insurance policy or creating an emergency fund that gives you complete control over your money.
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Who offers service line insurance?
Service line coverage is an optional type of insurance that covers repairs to underground utility lines on your property. This includes damage due to wear and tear, root invasion, mechanical or electrical failure, blockage, bursting or collapse, rust or corrosion, disconnection, excavation, and rodents or other animals. Many utility companies partner with third-party companies to sell service line warranties, so it is important to carefully read your policy and understand any exclusions.
Some companies that offer service line coverage include:
- Acuity
- Mercury Insurance
- People's
- Homeserve
- SLWOPA
- HomeServe through Duquesne Light
The cost of service line coverage depends on where you live, the insurance company, and the amount of coverage desired, typically ranging from $9 to $50 per year. Some companies offer additional coverage for temporary repairs, outdoor property, and additional living expenses if the home is uninhabitable. Service line coverage can often be added to your homeowner's insurance policy for a small additional cost.
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Advantages and disadvantages of service line insurance
Service line insurance is an optional type of insurance that covers repairs to underground utility lines on your property. It can provide peace of mind and financial protection in the event of costly and unexpected repairs. However, it is important to consider the likelihood of needing such repairs and the potential costs before purchasing this type of insurance.
Advantages of Service Line Insurance:
Service line insurance can provide several benefits to homeowners:
- Financial Protection: Repairs to underground utility lines can be expensive, often costing thousands of dollars. Service line insurance can help cover these costs, protecting you from unexpected expenses.
- Convenience: In the event of a breakdown, service line insurance companies can help coordinate repairs quickly, saving you time and effort in finding qualified contractors.
- Peace of Mind: Knowing that you are protected from unexpected repair costs can provide peace of mind and allow you to focus on enjoying your home without worrying about hidden issues.
Disadvantages of Service Line Insurance:
There are also some potential drawbacks to consider:
- Low Probability of Use: The likelihood of needing to repair underground utility lines is relatively low. Insurance companies offer these plans because, most of the time, repairs are not necessary, and they profit from the premiums.
- Limited Coverage: Service line insurance typically does not cover above-ground utility lines or issues that existed before the coverage was added. Natural disasters, lack of maintenance, and certain types of damage may also be excluded from coverage.
- Additional Cost: Service line insurance is an additional expense on top of your regular homeowners' insurance. While it is relatively affordable, typically costing a few dollars per month, it is still an extra cost to consider.
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Frequently asked questions
Service line insurance covers the cost of repairing damage to the underground utility lines on your property. This includes water, gas, sewer, electrical, and telephone or cable lines.
Service line insurance is worth it if you don't have an emergency fund and don't want to be caught off-guard by the cost of repairing underground utility lines, which can run from $3,000 to $4,000 on average. Some people prefer to have a maintenance fund and broad insurance coverage instead of insuring individual things.
The cost of service line insurance depends on where you live, the company you buy coverage from, and how much coverage you get. It typically costs $15 to $20 a month, or $20 to $50 per year.
You can get service line insurance by adding it to your homeowners insurance policy. Service line warranties are also available from third-party companies, which are typically offered by utility companies.
