Does Homeowner's Insurance Typically Cover A Broken Well?
The only person who will know for sure what your home owners policy covers will be your insurance agent. Best we could do is guess. I honestly have no idea.

As far as the expense of repair, it depends on how much of the labor you can do yourself. Excavators aren't exactly cheap to rent, but they aren't thousands of dollars either. Pipe itself is usually fairly cheap, unless it's large diameter copper.