By Chuck Kohut
Everyone has heard a variation of the old saying – “water always finds its level” – and it’s never truer than when one is talking water and condominium communities. In a single-family residence, a water leak creates havoc for the family, damages the house, and can certainly cost a great deal to repair. Just imagine a water failure in a multi-story condo building – on the top floor. A waterfall of damage winding its way through each unit fills one’s thoughts. In such multi-family buildings, the potential for damage and cost from plumbing failures and other water events can be multiplied exponentially.
Water damage and flooding has many sources. Just think of all the areas that water is used in a typical single-family residence – then multiply it by the number of units in your multi-unit building – we’ll wait…… It’s a pretty large number isn’t it? The more sources of water – the larger the opportunity for something to leak – and cause damage. Many leaks are small and unseen – until they become a problem and when they do it It’s often a large ordeal. According to Pure Insurance, 70% of condo insurance claims reported have been the result of water damage. “A simple leak can often add up to a sizable amount with damage being caused to multiple units.” In fact, PURE notes that damage to neighboring units often could result in “more than $100,000 of damage.”[i] And consider this – flooding is not an uncommon occurrence. Farmers Insurance reports that about one in 55 insured properties has a damage claim caused by water or freezing annually.[ii]
What’s Causing all the damage?
As mentioned above – anything that services a residence with water, or uses water, or has water pass through it could be the source of a leak that leads to flooding. Insurance claims for water damage are increasingly more significant, which in turn affects the premiums that condominium operators must pay. Weather, such as large sudden rain events, hurricanes, mechanical failures, and even human error all contribute to water damage.
The culprit causing thousands in damage could be as simple as a small washer that costs twenty-five cents, or something that is hardly ever thought about on a regular basis – such as water supply hoses for washing machines and dishwashers. According to Property Management Insider, “something as simple as a worn-out washer hose can flood an apartment and cause as much water damage beyond wet carpet as can torrential rains.”[iii] The same can be said for dishwashers, refrigerators with water dispensing features as well as water purification systems and water softeners. These appliances all have parts that can wear out or fail. Additionally, a poor plumbing repair or installation can result in a similarly disastrous situation. On the human side – overloading washing machines, skipping simple maintenance, and poor workmanship all can play a part in damaging one or many units.
So, what can be done?
The key is awareness and proactive planning. Property owners and managers should diligently focus on sources of potential leaks. This means auditing the age of appliances and replacing supply hoses regularly. According to noted home improvement expert Bob Vila’s blog, “failing washing machine hoses are responsible for $150 million yearly in flood damage”. The post goes on to suggest that “washer hoses should be replaced every 3 to 5 years, and they are as easy to replace as your garden hose.”[iv] In fact there are many options that can bring peace of mind when it comes to hoses. Braided stainless steel supply lines are one alternative that are not much more expensive but offer added strength.
Beyond the basics, it’s a good idea to create a plan to proactively address plumbing related systems over the long term. Evaluating all water connections for leaks is a good place to start. But going further is possible. Establish a partnership with a licensed plumbing contractor that provides an annual maintenance service or checkup. Another option would be to engage a provider who also offers services that will analyze water and even energy usage. Mike Lawyer, Director of Plumbing for DRF Water Heating Solutions (DRFtps.com) explains that “having a professional assessment can help you find hidden leaks before they become catastrophic. Additionally, a whole building water assessment plan can help you greatly reduce water consumption while eliminating early stage leaks.” Lawyer adds that “20% of all toilets leak. In a condo or other multi-family environment a simple toilet leak could be just that – a running toilet with no external complications – or – it could be a leak that eventually will greatly affect other units and cause extensive damage.” While the former is a nuisance resulting in wasted water and greater cost exposure, the latter is what really makes the costs (and claims) add up. Lawyer notes that “an analysis and program to replace leaky toilets can result in savings of hundreds of thousands of dollars in water usage alone, while removing the potential for a water damage event.”
Leak Detection – We have the Technology
Lastly – one of the most important things you can to in order to protect against flooding is to hire competent service providers. Never use an unlicensed plumbing contractor for installation or repair work. It’s illegal in most states – and you can be opening your property up for expensive damage and denied insurance claims. Water is just the start in fact. An improperly vented water heater could prove deadly. Be sure to perform your due diligence, seek recommendations, look to reviews, and get a sense for the quality of a plumber’s work – it’s important for the health, safety and integrity of your property.
What you Can’t See
The obvious damage that water causes is very wide ranging. From a small leak to a major flood many aspects of a home’s contents and structure can be affected. Rugs, wood flooring, family heirlooms and memories and especially the drywall can be destroyed by water. But what you don’t see can cause dire circumstances. Mold. The very word can strike fear in anyone associated with a multi-family property. With the evolution of building practices, buildings are more weatherproof, insulated and sealed than ever High efficiency HVAC systems, new advancements in insulation technology, and higher quality windows mean more energy efficiency. But, as relayed by Property Management Insider, “homes are so tight there is no way for the moisture to escape.”[v] The price of fixing a mold issue is high and can affect more than one unit. According to Home Advisor, the average cost of mold remediation is $2200 but could go as high as $6000.[vi] This points to the overall importance of stopping every moisture source or leak.
What about Frozen Pipes?
A quarter of a million homes throughout the US have at least one room damaged by frozen water pipes each winter according to State Farm Insurance.[vii] That’s 250,000 families disrupted by damage, lost possessions and the inconvenience repairs bring – during the coldest time of the year no less. Damage from frozen pipes can be significant, and expensive. The average claim for water damage due to frozen pipes is about $15,000 according to esurance.com.[viii] It’s not only the pipes that contribute to this cost – In fact – it’s not the freeze – it’s the thaw. And for multi-family properties this is where the costs and damage add up. As with any flood, water travelling from unit to unit will damage everything in its path. According to the Institute for Business and Home Safety, once a frozen pipe bursts as much as 250 gallons per day can escape from a one-eighth inch rupture.[ix] Homeowners, property managers, condo residents and even renters need to be diligent in their focus of just how important it is to be aware and prepare for the potential damage cold weather can cause.
There’s been a flood – so who’s responsible
A condo association’s bylaws and applicable state laws may affect who will eventually pay for a flooding event. However, flowing water does not discriminate. One unit’s problem very often causes others to have damage – and who pays in this instance is often not clearly defined. According to thinkGlink.com, “confusing the issue is the nature of insurance that condo buildings hold.” Unlike homeowners’ insurance, there is no standard insurance policy for condo owners. The type of insurance policy you have as a condo owner is dependent on the master policy held by the condo association.[x] The Chicago Tribune reports that “common area damage is often the responsibility of the home owners association, as is assessing the damage back to the offending unit.”[xi] The type of policy held, proving causality or negligence, and a host of other factors affect who ultimately is financially responsible when a flood occurs.
Stop the Flow – Before it Starts
As an owner, board member or property manager, the best advice is to be proactive in your approach. Routine maintenance and inspections are essential. Keeping track of the age of equipment and inspecting appliances that use water (water purification systems, water heaters, washers, dishwashers, toilets, faucets, external spigots, etc.) on a regular basis can help avoid issues in the first place. What’s more, proactive replacement of items such as rubber hoses is critical. Having a partnership with a forward-thinking plumbing service provider can help you save thousands of dollars in resources, not to mention the exponential cost a potential flood would cost. Additionally, understand your insurance policy and how the HOA bylaws address water related damage especially where multiple units are affected. Lastly, don’t be afraid to embrace technology. Evaluate systems and products that help you know what’s going on, and give you control.
DRF Water Heating Solutions serves multi-family, commercial and residential properties throughout the Midwest striving to improve people’s lives through better water solutions. Integrating water and energy usage assessments DRF has saved customers $1.3 million in water and energy related costs through its RCS programs. DRF specializes in the design and installation of large-scale water heating solutions as well as same day domestic water heater installation.
[i] Pure Insurance, March 2017 https://www.puresituationroom.com/insights/2017-3-19-condo-advice)
[ii] Farmers Insurance, https://www.farmers.com/inner-circle/gaps/my-neighbor-flooded-my-condo/)
[iii] John Robinson April 12, 2012 https://www.propertymanagementinsider.com/five-tips-for-preventing-water-damage-in-apartment-units)
[iv] Bob Vila Blog- https://www.bobvila.com/articles/bob-vila-radio-washing-machine-hoses/)
[v] Property Management Insider https://www.propertymanagementinsider.com/five-tips-for-preventing-water-damage-in-apartment-units)
[vii] State Farm https://www.statefarm.com/simple-insights/residence/dont-let-pipes-freeze-and-steps-to-take-if-they-do)
[viii] State Farm https://www.statefarm.com/simple-insights/residence/dont-let-pipes-freeze-and-steps-to-take-if-they-do)
[ix] insurancejournal.com, Frozen pipes cause billions in damage, but can be prevented. https://www.insurancejournal.com/magazines/mag-features/2006/01/02/64842.htm )
[x] Blog https://www.thinkglink.com/2013/04/22/if-a-neighbor-damages-your-condo-who-makes-the-insurance-claim/.)
[xi] Howard Dakoff, March 6, 2018 Chicago Tribune, https://www.chicagotribune.com/classified/realestate/ct-re-0311-condo-adviser-20180306-story.html.)