Water, water, everywhere

Garden flooded after an underground burst? Do not assume you are covered, writes Stephen Pritchard

Householders with leaking water pipes or drains this winter could be faced with a further nasty surprise, according to water companies: a large bill.

The notion that leaks or bursts are covered by domestic insurance is a popular misconception, the companies say. Most domestic contents policies pay for consequential damage like the repair of a flooded cellar, and for accidental damage to pipes and drains, but not for the repair of the pipes caused by frost, subsidence or wear and tear.

Property owners also frequently assume that pipes running through their gardens or under the drive are the responsibility of the water company. In reality, the water company maintains supplies only as far as the main external stopcock, usually in the street. Home owners have to arrange, and pay for, any repairs beyond this point.

A leak in the garden or under the drive can be costly to repair, say water companies: heavy equipment is often need.

Water companies are being encouraged by Ofwat, the industry regulator, to offer reduced-cost or fixed-cost repair services for leaks and bursts. Typical prices range from pounds 60 at South West Water to pounds 99 at Anglia, for non-metered customers. Anglia's metered customers are not charged for repairs to supply pipes.

Some water companies are also responding to last month's cold snap by posting details of special insurance cover against "plumbing or drainage emergencies". The Home Service Scheme, offered to householders by six water companies, including Anglia and Three Valleys, claims 185,000 members. Home Service Scheme is itself a subsidiary of South Staffordshire Water, which designed the package. Home Service Scheme's policy offers year-round, 24-hour call out using the insurer's own approved plumbers. Bills are settled directly with the repairers and there is no minimum charge the householder has to bear. Instead, there is a maximum benefit of pounds 150 for internal repairs and pounds 550 for external work.

According to Richard Harpin, the managing director of the Home Service Scheme, this covers 97 per cent of claims. As long as the incident is an emergency that threatens health or property, the householder is covered. Regular maintenance, such as dripping taps, is not. The policy costs pounds 45 a year.

HSS believes there is little duplication of its policy and household cover, a point supported by the Association of British Insurers. Elements of the scheme will appeal particularly to some householders. There is no inspection prior to providing cover and premiums are fixed, to the advantage of owners of older or larger houses.

A similar scheme is offered by Green Flag as Home Assist, through 10 water companies, including Thames Water. Home Assist also offers 24-hour, all-year call-out, for a slightly higher charge of pounds 57 a year.

Domestic insurers advise policy holders to check their cover before joining either scheme: accidental damage to external pipes and supplies is normally part of a household policy.

Guardian's cover includes accidental damage to all pipes and services, in the house or outside. According to the company, damage caused by digging, heavy vehicles rupturing a supply pipe or even tree roots would normally be covered under the accidental damage provisions.

This is a typical view. Direct Line says cables and pipes are covered against accidental damage by its policies. Commercial Union covers damage to external pipes or cables on all policies but it must be "accidental damage, not routine maintenance". Inside the house, the picture is less clear: only customers who have specifically opted for accidental damage on their buildings policies are covered. The Home Service Scheme and Home Assist go further by covering bursts from wear and tear.

While the water companies take a strong line on householders' responsibilities for leaks and damage, the position is not the same for all utilities. Water supplies are not the only services that might be harmed by careless contractors or over-enthusiastic gardeners. Electricity, phone and gas connections could be vulnerable too.

Unlike water companies, other utilities own the pipes or cabling up to the meter, or in the case of phone lines, the master socket. All have a legal right to charge householders for damage to their cables or pipes, but not all will. Electricity companies take a dim view of anyone breaching cables. They will carry out repairs but most will charge customers. This is as much as a deterrent as for financial reasons.

MEB, which covers the Midlands, reports eight incidents of damage by householders to its cables every day, with garden rotovators a particular culprit. It makes a "nominal" charge for repairs but is more concerned about safety. It encourages anyone working below ground to obtain site plans for the property before they dig.

British Gas Transco is more lenient. It charges other utilities for damage to its pipes, but according to a spokeswoman, it would not normally pursue a householder for accidental damage. The company's priority is to secure the gas supply.

Nynex, a cable company, says it has no record of charging a customer for accidental damage. Charging might encourage subscribers to go elsewhere.

Nynex says accidental damage is rare but incidents do happen and gardeners are not the only culprits.

In one case, burglars new to cable television were the cause. Mistaking it for part of an alarm system, they tried to sever Nynex's cable.