We had a pin hole leak in our hot water pipe in our crawlspace. We noticed a tiny speck of mold on our furnace cabinet, discovered the leak under the house, immediately turned off the water and repaired the pipe. Our claim was denied as they said it was a “continuous” leak that “went on too long”. We have no idea when the pipe burst but it was repaired immediately after the leak was identified. The entire crawlspace was wet and the laminate floor above is now warped. I asked our insurance to define “continuous” but they said it was a grey area and they don’t have a strict definition. It seems that gives them ample room to deny claims fairly easy. We are planning to appeal the decision as there was no way we could have know about the leak sooner and did not delay repair.
perry.rachel asked 2 years ago 
Don A. Lesser, Esq. Expert answered 2 years ago Without speaking to your specific claim or policy, most homeowner’s policies contain provisions which attempt to avoid coverage for damage caused by the discharge of water over time. Some policies do this by limiting water damage coverage to “sudden and accidental” events such as the bursting of a pipe or some accident which causes sudden damage to a plumbing fixture. Other policies contain exclusions for loss or damage caused by “gradual” or “continuous” leakage or seepage of water from plumbing or other fixtures. Some specify a minimum period of continuous discharge, typically 14 days or more. In practice, adjusters determine whether the leak or seepage has been “gradual” or “continuous” based on the extent of the damage it has caused, and whether there is damage which could only have been caused by extended exposure to the leaking water.
Keep in mind that to apply an exclusion or limitation for leakage or seepage to your loss, the carrier must conduct a thorough and objective investigation of the damage and its cause(s), the facts of which actually show damage which could only have been caused by the type of leakage or seepage the policy language actually excludes. They must deny the claim in writing, and the letter must cite the specific policy language on which the carrier relies, and the evidence which supports its conclusion that the leakage was “gradual,” “continuous,” extended for “14 days or more,” or whatever the policy provision actually says. They can’t deny the claim based only on the adjuster’s mere opinion that’s not supported by evidence. Doing so is a violation of California’s Fair Claims Settlement Practices Regulations issued by the Department of Insurance.
Unless the policy language suggests otherwise, coverage limitations for leakage or seepage over time generally do not depend on when the policyholder discovers the leak.