Water damage restoration insurance checklist: what a water damage restoration company should carry

The water damage restoration company insurance checklist

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Water damage restoration usually carry general liability, pollution liability and workers' compensation. Water restoration companies arrive first after a pipe bursts, tear out wet material, run drying equipment for days in occupied homes, pack out contents, and bill the homeowner's insurer, who audits every line. The property manager and the lender ask for proof of each. The checklist below says what every item does, who requires it and how to check it on the policies you already have.

Reviewed by Michael LaBarbera, Licensed property & casualty agent, Provident Financial Group · Reviewed Oct 12, 2026 Updated Oct 14, 2026

Who asks a water damage restoration company for what

Who	What they usually want to see
Property managers & HOAs	General liability with the manager and owner as additional insureds, and workers' compensation
Banks, lenders & SBA loans	Property or auto physical damage with the lender as loss payee, and liability proof at closing and every renewal
Enterprise clients & vendor onboarding	General liability, professional or cyber liability, workers' compensation and often an umbrella

Each of them wants a certificate, and most want it again at every renewal. A live certificate link from the wallet shows today's coverage to every holder and tells them when it changes.

How to check what you already have

General liability declarations page. Three liability numbers matter: each occurrence, general aggregate and the products–completed operations aggregate. Then the forms list: blanket additional insured, waiver of subrogation and primary and non-contributory wording satisfy every contract; scheduled forms satisfy one.
Pollution liability. Site-based or contractors form, claims-made or occurrence, the materials named (mold, asbestos, lead, fuels), and transport and disposal coverage.
Workers' compensation information page. Item 3.A must list every state you work in, item 4 must carry the right class codes, and the employers' liability limits should meet what contracts ask. Check that the estimated payroll is close to this year's.
Auto schedule. Every vehicle listed with the right garaging address and use; symbols that include hired and non-owned auto; physical damage with the lender as loss payee where the vehicle is financed.
Equipment schedule. Owned items scheduled above the per-item threshold, a blanket limit for small tools, leased or rented equipment included, and the valuation (replacement cost or actual cash value).
Bailee coverage. The limit for customers' property at your premises and in transit, the valuation basis and any exclusions for specific items.
Hired and non-owned auto. Look for the symbols 8 and 9 or an endorsement by that name on the auto or general liability policy; without it, staff in their own cars are uninsured on company business.
Employment practices declarations. Limit and retention, third-party coverage for claims by customers, and whether wage-and-hour claims carry any defence sublimit.

What usually goes wrong for water damage restoration companies

Mold that grows after the drying, blamed on the restorer and excluded under the fungus exclusion.
Packed-out contents damaged or lost in storage, uninsured as property in your care.
A mold or asbestos exclusion sitting on the general liability policy of a business that remediates mold or asbestos.
Damage to the exact thing you are working on is excluded on most general liability forms; installation floaters and care, custody and control endorsements fill that hole.
Relying on general liability for a damaged item that was in your hands when it happened.
A personal auto policy on a truck with the company name on the door.

What underwriters will ask a water damage restoration company

Whether the business does mold work and reconstruction as well as mitigation, the drying equipment schedule, and the value of contents in storage
Materials handled (mold, asbestos, lead, biohazard), certifications and disposal practice
Share of work paid by insurance carriers and the contracts they require
Residential versus commercial split of the work
Whether any work is done above three stories or below grade
Typical and maximum value of customer property on hand at one time

Have the answers in the wallet before the renewal and the quote request fills itself in; CoverMatch sends one application to every eligible carrier and lines the quotes up against what you have.

Renewal timing

Audits at year end compare payroll, receipts and subcontractor costs with the estimate, so keep the wallet's size figures and the subcontractor certificates current. Start comparing sixty days before expiration, and ask for the limits the next contract will need rather than the ones the last one did.

Questions people actually ask

Mold appeared after our drying job. Whose claim is it?

The homeowner's insurer will say yours, and the fungus exclusion on a standard general liability policy will leave you defending it alone. Contractors pollution liability with mold named covers the claim that follows every water job.

We pack out and store customers' contents. Are they covered?

Not under general liability and not under your property policy. A bailee limit covers customers' contents in your trucks and warehouse, and it is the coverage the homeowner's insurer will ask about when a box goes missing.

Why can't a water damage restoration company rely on general liability?

Because the fungus, bacteria, asbestos and pollution exclusions on standard forms remove the very thing you do. Contractors pollution liability written for remediation, with the materials you handle named, is the policy clients and insurers paying for the work expect to see.

Does general liability cover damage to a customer's property while I work on it?

It covers damage to the rest of their property, not usually the part in your hands. Many forms exclude property in your care, custody or control, so a water damage restoration company that handles valuable items or systems needs an endorsement or an installation floater. The policy explainer in the wallet flags the exclusion when it reads your policy.

A customer's item was damaged while we had it. Does general liability pay?

Usually not; property in your care, custody or control is excluded. A bailee policy or an endorsement built for your trade pays for it, and it is the coverage customers assume you have.