i have a story to tell...
but long story short, i had a crappy razr v3c (that froze every time i sent a txt) and i took it my local verizon and told them about the freezing problem and they were really cool about it and decided to give me a brand new razr v3c!
but the the thing that gets me is i didnt buy it from verizon (bought it from a friend) and i did not have any insurance on the phone but they said they would look at it anyway and gave me a new phone even though i had no insurance
but anyway i dont know their policy on water damaged phones but maybe you should just go talk to the guys at verizon and see what they say