Insurers Are Starting to Require Leak Detection. Here's What It Means for Your Home.

Matt Fitts, M. Fitts Construction · CSLB #1098070 · Updated October 2026

If you've gotten a letter from your homeowners insurance company about a “water leak detection device,” you're not alone. California insurers have spent years paying out on water damage claims, and some have stopped just recommending these devices and started requiring them.

We rebuild water-damaged homes across the Inland Empire for a living. Here's what's changing, what counts, and what to do if your carrier has asked.

What's changing

Water damage is one of the most common homeowners claims in the country, and one of the most expensive to fix. The average non-weather water damage claim runs well into five figures. Insurers have noticed that most of these losses start the same way: a supply line, a water heater, or a washer hose fails while nobody is home, and the water runs for hours.

Mercury Insurance now requires a qualifying water leak detection device on some homeowners policies. On those policies, Mercury says the device must be installed and active before your first renewal, and if it isn't, the policy won't be eligible to renew. Which policies are affected depends on the home and the coverage, so your agent is the one who can tell you whether yours is one of them.

Other carriers offer discounts for these devices rather than requiring them, and the details vary by company and by policy. If you've received a notice, read it closely and call your agent.

What counts as a “qualifying device”

Mercury lists three kinds of devices that can meet its requirement:

1. Whole-home water flow monitoring. A device on your main line or meter that tracks how much water your home uses and alerts you when water is flowing that shouldn't be.
2. Leak detection with automatic shutoff. A smart valve on your main water line that can shut the water off on its own when a leak is detected — not just send an alert.
3. Point-of-leak sensors. Small sensors placed where leaks start. Mercury requires at least one per bathroom, plus two more.

One important exception: for a secondary or seasonal home with a dwelling limit of $2 million or more, Mercury requires the automatic shutoff kind. An alert alone doesn't help much when nobody is there to act on it.

That point is worth thinking about for any home. An alert tells you there's a problem. An automatic shutoff stops the water — whether you're home, at work, or on vacation.

What it can save you

Mercury's own FAQ puts average annual premium savings at about $75 for a flow monitor and about $100 for a device with automatic shutoff, and says actual savings vary. Ask your agent what applies to your policy.

The bigger savings is the claim you never have to file. Even with good insurance, a water loss usually means a deductible, a plumbing repair your policy may not cover, weeks of drying equipment and contractors in your home, and a claim on your record at renewal time.

How to prove it to your insurer

Your carrier will want to know the device is installed and working. Mercury asks customers to notify their agent once the device is in. In general, it helps to have:

• What was installed, where, and when
• Who installed it, with their license number
• The permit and inspection record, if the work required one (cutting into your main water line usually does)
• Proof the system works — a live test, recorded or witnessed

Keep it all in one place. If you ever do have a loss, the same paperwork shows your adjuster that your plumbing was maintained.

Why a permit matters

A smart shutoff valve goes on your main water line, which means cutting into the pipe that feeds your whole house. In most Inland Empire cities, that needs a plumbing permit and an inspection. Unpermitted work can raise questions on a future claim. When we install, we pull the permit, meet the inspector, and hand you the paperwork with everything else.

What to do next

1. Read your notice and note the deadline (usually your first renewal).
2. Call your agent and ask exactly which device types they accept and what proof they want.
3. Get the house looked at. Where's your main shutoff? How old is your water heater? Which supply lines are original? That decides what you actually need.

We do that last part for free. The Free Whole Home Water Risk Assessment is a 60-minute visual walk-through of your home. You keep a written Home Water Risk Report and an Emergency Water Action Plan whether you buy anything or not. If you do install with us, you watch it work before we leave: we close your valve from your phone and you watch the water stop — and with a sensor at every supply line, we put water on a sensor and you watch your water shut off, live, on your phone. If it doesn't pass in front of you, you don't pay for the install.

Related: The Insurance Claims Guide — how the rebuild side of a water or fire claim works, step by step.