Two types of coverage. One buried problem. Know where your protection begins — and ends.
Picture this: You open your mailbox and find a letter warning you’re on the hook for big repair bills for the pipes and utility lines buried under your yard. It offers a service plan that sounds pretty crucial – but then you ask yourself, isn’t something called “Underground Service Line Coverage” already included in your home insurance? Are they one and the same? Do you need both? Or are you being sold something you already have?
If you’ve ever found yourself staring at one of these mailers, scratching your head, and wondering what’s covered and what to do – you’re definitely not alone. This is a pretty common and often super confusing issue for North Carolina home owners – especially when you get down to the fine print and start reading about “what happens when the main is off your property.”
In this article, we’re going to cut through all the confusion. We’ll tell you exactly what underground service line coverage includes, how it differs from the utility company’s “service contract,” and why the difference actually matters when a pipe breaks or a line fails. And most importantly, we’ll give you some good advice on what to ask, what to look for, and how to make sure you’re not left footing the bill for something you thought was already covered.
Let’s start digging.
Underground service line coverage is a pretty little-known part of modern homeowners insurance, but it’s becoming increasingly important. It helps protect you against the often-expensive repairs needed when utility lines – like water, sewer, electric, gas, or data – are damaged or fail due to wear and tear, tree roots getting in the way, freezing, or if they get knocked during digging.
This coverage applies to the part of the utility lines that you’re responsible for, which is usually from your home to where they connect to the public utility’s main line. If a line fails on your property and it’s your job to fix it, this is what helps cover the bill.
In North Carolina, lots of homeowners policies now offer this as an additional coverage (like the NCHOGE Underground Service Line Coverage), which may help pay for things like:
The good news is this is an optional endorsement that’s often added for a pretty modest premium (think $30-$50 per year), with coverage limits from $10,000 to $20,000 depending on who you’re with.
But, like any insurance, it has its limits. For instance:
In short, underground service line coverage helps fill in a big gap in standard homeowners policies – making sure you’re protected against issues that aren’t covered by regular plumbing or utility failure language.
If you’re getting a letter or flyer worrying about the cost of broken pipes or damaged utility lines, chances are it’s from your local utility company – or a third-party administrator like HomeServe or American Water Resources. These are usually for what’s called utility line protection plans or service line warranties, which are not the same as real insurance.
Unlike underground service line coverage, which is part of your homeowners policy, utility coverage plans are contract-based service agreements. They’re designed to protect homeowners from repair bills on specific service lines – usually the ones that fall just outside your home and may be in the public right-of-way, like water or sewer lines between your home and the utility’s main.
What They Usually Cover:
What They Usually Don’t Cover:
This is pretty important to keep in mind: these utility line protection plans are not insurance.
That means:
In the mailer we’re talking about, the utility company promotes coverage that kicks in when “the main is off the client’s property” – a clue that this plan may cover areas beyond what your homeowners insurance covers. But without clear terms, these offers can lead to a big mess – because you end up unsure of what you’re actually buying, and how it complements or duplicates your existing insurance.
That’s why its really important to pit these two types of coverage against each other – and we’re going to do just that in the next section.
You can obtain a homeowner’s insurance quote here: ALLCHOICE Insurance Homeowner’s Quote
DID YOU KNOW? Only about 9% of homeowners bother to take out service line coverage – and that’s despite the fact that the average service line repair can cost you upwards of $10,000.
At first glance it looks like underground service line coverage and utility coverage are just two names for the same thing , but they’re not. Both are aiming to keep you safe from the financial hit of buried line failures, but they’ve got some big differences when it comes to the ownership, scope and structure.
Where They Overlap
Both types of coverage are all about repairing or replacing buried lines like water, sewer, or electrical lines, and they’ll cover damage caused by common problems like corrosion, root growth or freeze/thaw cycles. They may also involve excavation – that depends on the situation. And both are looking to reduce out of pocket costs for the homeowner.
But that’s where the overlap often ends – especially when it comes to where the line is located and who’s responsible for it.
| Aspect | Underground Service Line Coverage | Utility Company Coverage |
|---|---|---|
| Provider | Insurance Company (via endorsement) | Utility company or 3rd-party (via warranty) |
| Applies to | Lines you own or are legally responsible for — typically on your property | May cover the line from your property to the utility main, including areas off your property |
| Claim Process | Filed through your home insurance agent | Filed with the utility plan’s service center |
| Contractor Choice | You may choose your contractor (depending on insurer) | Often must use provider’s contractor |
| What’s Covered | Line repair/replacement, excavation, landscaping, temp repairs, ALE | Typically just the line repair/replacement |
| Exclusions | Damage beyond your responsibility, septic/well/sprinkler systems | Damage on your property, landscaping, loss of use |
| Regulated By | State insurance law (e.g., NC DOI) | Contract law; may not be regulated as insurance |
| Cost | Typically $20–$50/year for $10k–$20k coverage | Monthly fee; varies ($5–$15/month common) |
Real-World Example:
Let’s say a sewer line collapses under your front lawn, and you’re responsible for fixing it.
If you’ve got underground service line coverage, your home insurance might pay for
But if the same line fails under the sidewalk in front of your house, and the utility company owns that bit, your home insurance won’t cover it – but the utility plan might, assuming the plan includes that bit.
In a nutshell, the utility plan might fill in the gap left by your home insurance, especially beyond your property line. But it’s unlikely to match the breadth or quality of an insurance endorsement, especially when it comes to restoration, living expenses and flexibility.
Next up we’re going to look at how these differences play out in real life – and how you can use this knowledge in a practical way.
DID YOU KNOW? A massive 70% of service line failures happen on the homeowner’s property, which means that the homeowner, not the utility company, ends up picking up the tab.
This blog article was inspired by a real-life question that’s been popping up a lot lately at ALLCHOICE Insurance. It started with a straightforward email from a client – just like a lot of other people – asking whether a letter they got in the mail offering “utility coverage” was something their current homeowners insurance already covered.
In this case, the homeowner got a flyer warning about potential underground utility failures and promising protection “when the main is off the client’s property.” No surprise, they went to their agent to see if they were already sorted for coverage under their ERIE policy.
Here’s what we discovered:
None of these were even mentioned in the utility company’s flyer.
The ALLCHOICE Recommendation:
As one of our agents put it -What I’ve been telling folks is get both, just in case. Worst-case scenario they file it first with the utility company – see what they’ll cover – and then fall back on home insurance if needed.
That belt-and-suspenders approach makes plenty of sense for homeowners with older houses, or ones with long runs between their home and the public utility connections. But its super important to know exactly what each plan covers and where that ends.
So thats why we advise our clients to:
Underground service line coverage is an add-on to your homeowners insurance policy that covers the cost to repair or replace damaged utility lines that are buried on your property. These lines can include water, sewer, electric, gas, and communication cables - as long as you're legally responsible for them. The coverage usually includes excavation, temporary repairs, and even restoring any landscaping damage that happened during the repair.
For most homeowners, yes - especially if they've got older homes, mature trees, or extensive landscaping. Repairs to underground lines can set you back thousands of dollars, and without this endorsement, those expenses are typically not covered under standard homeowners insurance. For a relatively small annual premium, buried utility line coverage gives you some serious peace of mind and protection from unexpected repair bills.
Not as a standard thing. Homeowners insurance usually doesn't cover damage to underground electrical lines unless you've added a service line endorsement. With that endorsement in place, electrical lines that run from your home to the connection point with the public utility - and are your responsibility - are covered for many different types of damage, like wear and tear, corrosion, or accidental hits.
Yes, but only if you've got the right endorsement. Most homeowners insurance policies exclude damage to underground water or sewer pipes unless you've added service line coverage. This endorsement will cover things like pipe collapse due to roots or corrosion - but only up to the point where your responsibility ends.
Service line coverage is often a real bargain at the price. It plugs a gap in homeowners insurance that leaves homeowners with a hefty repair bill on their hands when the unexpected happens. If your house is an older one, or if you have big trees hanging over your service lines, this coverage could end up saving you a small fortune in the event of a failure - thousands of dollars that you wouldn't have to dip into your savings.
So, now that you know the difference between underground service line coverage and utility service contracts, how do you decide what’s right for your home? It starts by understanding your unique situation — your home’s age, layout, and exposure — and asking the right questions.
Key Questions to Ask Before Choosing Coverage
1. Where’s my responsibility start and stop?
Ask your local goverment or utility company where your ownership begins and where it ends – its usually from your foundation to the utility main, but some homeowners are responsible beyond that.
2. What’s the connection point to the utility main?
Knowing this helps you figure out where your homeowners insurance stops and where the utility plan might kick in.
3. What kinds of damage are covered?
Are things like corrosion, tree roots getting into the pipes, or just plain old wear and tear included? The ERIE service line endorsement covers those things – but many utility plans may not.
4. Does it cover excavation, landscaping, or restoration?
Home insurance endorsements usually do, but utility plans typically do not.
5. What are the policy limits and deductibles?
ERIE’s endorsement provides a certain limit (as noted in your policy declarations), minus a small deductible. Make sure the utility plan’s limit is enough to be worth it.
6. Does it cover temporary repairs or help with living expenses (ALE) while you’re getting things sorted out?
These benefits are included in many homeowners policies but are rarely part of utility contracts.
7. Can I choose my own contractor, or is it all assigned?
Utility plans usually assign a contractor, while homeowners insurance may give you more flexiblity.
8. Are there waiting periods, exclusions, or service fees in the utility contract?
Read the fine print. Many utility plans have gotchas that only show up when you go to file a claim.
For North Carolina homeowners, trying to get their head around the difference between underground service line coverage and utility company service contracts isn’t just a theoretical exercise – it’s a practical necessity. At first glance, these two types of protection might seem very similar but they actually serve totally different purposes, and being clear on what each one covers can be the difference between having a paid claim and having to reach deep into your pocket for a costly repair.
Adding underground service line coverage to your homeowners policy will protect the lines you own or are responsible for – that usually means everything on your property up to the point where the utility company takes over. It provides a decent level of protection – that includes digging up the lines, doing temporary repairs, restoring any landscaping that was dug up, and even paying out for extra living expenses if your home becomes uninhabitable.
Utility coverage plans on the other hand are usually contract-based warranties that are offered by the utility company or a third party. These plans often cover lines that go beyond your property boundary, especially the bit between your home and the main utility connection – something your insurance might not pick up. However, they tend to offer less protection and fewer benefits compared to service line coverage.
The smart move for most homeowners? Don’t make an uninformed guess about what each plan covers – get an idea of what each one covers, and seriously consider getting both if your situation calls for it. A few extra dollars a month in premium now could end up saving you thousands down the line.
Need some help checking your coverage or making a decision? We’re here to help at ALLCHOICE Insurance – give us a call today so we can make sure you’re properly covered where it counts.
Check out Team ALLCHOICE or call us at 1-844-540-0463 to speak to a Risk Advisor.
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