Does Homeowners Insurance Cover Furnace Problems?

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Written by
Cara Carlone
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Most home insurance will cover furnace problems such as repairs or replacement if caused by a covered peril.

If you’re not quite sure what constitutes a covered peril, keep reading and I’ll clear it up for you. With 20 plus years spent helping consumers gain a better understanding of their home insurance, I can assist in expanding your knowledge of insurance coverage and furnace problems.

Key Takeaways

  • Many insurance companies offer equipment breakdown coverage. This is an optional add-on to your policy that will cover causes of furnace damage that aren’t typically covered, such as electrical or mechanical breakdown.

  • If your furnace breaks down due to wear and tear, lack of maintenance, or mechanical problems, it’s unlikely that you’ll be able to use your  homeowners insurance to buy a new one

  • A standard homeowners insurance policy covers specific damage to household systems, which includes furnaces if they’re damaged from sudden, accidental cracking, burning, tearing or bulging.

  • Home insurance can help you pay for furnace repairs or replacement if the cause of the damage or loss is covered in your policy.

Does Home Insurance Provide Coverage For Furnace Problems?

Homeowners insurance covers furnace damage only if it was caused by a covered peril as stated in the policy.

This includes perils such as water leaks, fires, storms or other non-maintenance related problems. If your furnace breaks down from a lack of maintenance, home insurance will not pay for the repair or replacement. Depending on your home insurance policy, you must provide evidence that your furnace was damaged or destroyed by one of the named perils. HO-3 policies ordinarily have sixteen named perils that are listed below.

  1. Damage from Vehicles
  2. Windstorm or Hail
  3. Falling Objects
  4. Riots
  5. Damage from Aircraft
  6. Fire or Lightning
  7. Weight of Ice, Snow, or Sleet
  8. Vandalism
  9. Overflow of Water or Steam
  10. Freezing of Warp Systems
  11. Smoke
  12. Explosion
  13. Theft
  14. Sudden Warping of Home Systems
  15. Sudden and Accidental Damage from Power Surges
  16. Volcanic Eruptions

What Types of Furnace Problems Are Covered By Your Home Insurance?

Your home insurance policy will usually offer coverage for these types of furnace problems:

  • Sudden and Accidental Damage: If a water supply pipe bursts and floods your basement causing damage to your furnace, your home insurance will usually pay for repairs or a new furnace. You’ll also be covered if your furnace suddenly cracks or explodes.
  • Freezing: In the event that your furnace freezes and then breaks, home insurance will likely cover its repair or replacement provided that you maintained heat in your home at the time the loss occurred.

Note: Some homeowner insurance policies have a separate deductible for hurricanes or wind storms. The deductible might be a percentage of your dwelling amount, so check your deductible before you file a claim. You don’t want to file a claim if your deductible is going to be more than the amount of the damage.

What Losses From Furnace Problems Are Covered By Home Insurance?

Losses from furnace problems are usually covered by your homeowners insurance policy.

There really aren’t many losses likely to occur if you have furnace problems. However, if you are unable to maintain heat in your home due to a broken furnace and water pipes freeze and burst as a result, your insurance will usually provide coverage.

For instance, if your pipes froze and burst in this broken furnace scenario, flooding parts of your home and damaging floors, ceilings, carpets, rugs, furniture, appliance and other personal belongings, as long as you can show that your furnace didn’t break down due to negligence or failure to provide routine maintenance, you should be covered.

Please note that the burst pipes themselves wouldn’t be covered, though.

When Are Furnace Problems Not Covered By Home Insurance?

Earthquakes: Earthquakes are typically named exclusions in standard home insurance policies. If an earthquake damages or destroys your furnace, you will need separate earthquake coverage.

Flood Damage: If your furnace is damaged from flooding, standard homeowners insurance won’t cover it. In that scenario, you would need coverage from a separate flood insurance policy.

Mechanical Breakdown: If your furnace suddenly ceases to work due to a mechanical breakdown such as a faulty motor or electrical issue, it’s not usually covered. Some insurers offer “equipment breakdown coverage” as an optional add-on to bridge this gap.

Gradual Deterioration: Gradual deterioration over time is not covered by home insurance. For example, if your furnace deteriorates gradually, which causes inefficiency and/or failure at some point, this is not a sudden, accidental event that is covered by standard homeowners insurance policies.

Wear and Tear/ Negligence: Homeowners insurance doesn’t usually cover damage that results from everyday wear and tear or lack of proper maintenance. If your furnace breaks down because of rust, aging, or neglect, your insurance probably will not provide reimbursement for replacement or repairs.

What Should You Do If Furnace Problems Cause Damage To Your Home?

The first thing you need to do is an inspection of the furnace to try and determine the cause of its breakdown. In many such cases, there’s a simple fix that most homeowners can DIY to get the furnace up and running again.

If your home has been damaged by furnace problems, check your policy or speak with an agent at your local home insurance office, and find out if it’s a covered event.

If it is, notify your insurer right away to let them know what has occurred.

Take clear photos and perhaps videos as well of all the damage caused by the furnace malfunction. Take good notes that describe in detail all of the damage that resulted.

Arrange to have an adjuster sent to your home to perform an assessment of the damage to your home and belongings. If your home is uninhabitable due to the damage from the furnace problems, request immediate funds for housing, meals and more from your home insurer.

Are There Ways You Can Avoid Furnace Problems?

Yes, there are things you can do to help avoid furnace problems. Here are a some things to do that will help lessen furnace problems:


  • Make sure to check that your furnace is turned on and in heat mode.
  • Check to make sure that the temperature setting is correct.
  • Make sure that the circuit breaker for the furnace is turned on, and that the fuse or breaker is working.
  • For gas furnaces, check to make sure that the pilot light is lit, or if there’s a problem with the gas line.
  • If the flame sensor is dirty, clean it with compressed air.

In addition, you should change your air filter at regular intervals, keep the area around the furnace clean and uncluttered, do regular inspections of the flue and vent system, install carbon monoxide detectors, and have a professional HVAC inspection performed annually.

Practicing preventative measures will help to keep your furnace functioning well for years to come.

When Should You File A Home Insurance Claim For Furnace Problems?

If your home and property has sustained significant damage due to furnace problems resulting from a covered peril, you may want to consider filing a claim.

Deciding whether or not to file a claim can be challenging simply because there are pros and cons to whatever decision you make. For instance, if your deductible is $3,000 and the repair or replacement of your furnace is estimated to cost about $2,500, it would gain you nothing to file a claim.

On the other hand, if your deductible is $1,000 and the repairs or replacement of the furnace will cost in the neighborhood of $5,000—you may well want to move ahead with a claim.

Keep in mind that it’s very probable your home insurance premium will increase following filing a claim. According to statistics, the average home insurance policy goes up by 26% after a first claim is filed. This increase will stick with you for quite some time and may even be permanent for the life of the policy.

How Do You File A Home Insurance Claim For Furnace Problems?

Filing a claim with your home insurance provider is a reasonably simple process. If you’re filing a claim for furnace problems or damage related to furnace malfunction or breakdown; it’s pretty straightforward.

Go over your home insurance policy or speak with your insurer’s agent to see what is covered regarding furnace problems.

Once you’ve ascertained what is covered and what isn’t, you can proceed with your claim, provided your furnace problems are indeed covered.

Contact your insurer right away to notify them of the incident.

Take stock of the damage as well as the cause of the damage. Next, work on documentation. Get photos and make videos if possible. You don’t need an expensive movie camera. Just your cell phone camera will make an acceptable video. Make thorough notes pertaining to every aspect of the damage to or caused by your furnace problems.

Meet with the adjuster that your insurance provider will send to assess the damage and likely cause of the furnace problems.

Once you get the go-ahead from your insurer, start getting estimates from licensed, reputable contractors to repair or replace the furnace. Submit these estimates to your insurance carrier and wait for approval of both the estimates and the contractor/s. Once you receive approval, the work can proceed.

Note: Some insurers have separate deductibles for wind or hurricane losses. These  deductibles may be a percentage of your home’s dwelling limit and not a flat amount. Always look at the correct deductible before deciding whether the damage is more than that amount.

Please note that you will have to pay your deductible before the claim will be paid.

Are There Additional Types Of Coverage Available For Furnace Problems?

Yes, if you want to have additional coverage for furnace problems, you have several options open to you:

  • Customized Home Insurance: Many insurers offer optional policy add-ons or endorsements. You should look for endorsements that cover causes of furnace problems that aren’t usually covered in standard home insurance policies, like electrical or mechanical breakdown.
  • EBC (Equipment Breakdown Coverage): Check to see if your home insurance policy offers an endorsement called Equipment Breakdown Coverage, EBC. This endorsement will give you extra coverage for specific electrical or mechanical failures related to the furnace. EBC availability does vary by state, so check your policy.
  • Home Warranty Companies: A home warranty plan covering your furnace will come in handy if your furnace problems leave you without heat during the winter. Home warranty companies give homeowners financial protection for most major home appliances and essential systems.


Can you purchase separate insurance coverage for furnace problems?

Yes, you can. You can buy a separate policy or as mentioned above, a home warranty or an endorsement, or rider, to your existing policy.

Will a standard homeowners insurance policy cover furnace problems?

In many cases, yes, it will. But as previously noted, the main things your home insurance will cover are events related to covered perils.

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