For exactly this reason. I've known several people who've had this issue. It's only a matter of time with a water heater tank that it will rust out and cause a flood. It's one of the only appliances in the house where it's a good idea to replace before it actually dies.

Our plumber says that he recommends that you crawl under it with a flashlight at least once a year to inspect it and make sure there are no visible signs of rust or corrosion.

When ours did that I didn't even turn it in because the State Farm policy definitely read like it was excluded. Crap.

Water heater died, but it was more of a slow leak and did not get above the faux hardwood floors so no damage to furniture or (thank heaven) the bar.

But it was a hefty price to replace the floors and do the mold remediation. They covered it all