If you work in property claims, you know about the headaches mold can cause.
Over the last 15 years, insurance claims involving mold damage have spread like an unsightly black patch on drywall. It didn’t take long for the financial costs to add up, and insurance providers were quick to protect themselves by limiting coverage. These days there are mold exclusions or limitations hidden in the language of a lot of policies. Whether you are an agent or simply a policyholder, you should know whether or not a policy covers mold damage.
Standard policies don’t generally cover water damage that comes from water seepage, leaky pipes, humidity, drainage problems or condensation. Sudden, accidental issues (think burst pipes) are covered, but as we mentioned, even policies that cover water damage usually have mold exclusions. This means policyholders could have zero protection against mold damage. This matters because an especially bad case of mold can render a property virtually unsellable.
Standalone mold policies are rare, and if you can get one where you live it’ll probably be expensive. You or your clients may be able to get “buy-back” endorsements for mold clams that let the homeowner modify the terms of the policy and pay more money for some mold coverage. Even where the homeowners can get a rider on an existing policy, these cost up to $1,500 extra per year, especially in humid Southern states.
So what’s the deal with mold, anyway? It can increase the instance of allergies and skin irritation, but for most people a mild-to-moderate case of mold exposure is harmless. But it’s ugly, and if it takes over a structure it can even lead real damage.
Mold needs warm, damp conditions to thrive. The spores can survive in dry conditions over long periods. They wait in the dark recesses of your walls and wait for ideal conditions to grow and take over.
Prevention is the best protection. Keep humidity low and use bathroom ventilation and kitchen exhaust fans. Make sure windows, pipes and the roof are all well-insulated against moisture and condensation. Clean bathrooms and any other areas prone to mold growth with a bleach/water solution and make sure all surfaces stay as dry as possible. Keep your gutters and air ducts clean. Follow all these steps and you’ll have won 90 percent of the battle.
If you are an insurance agent or a claims adjuster, you know that newer homes are constructed with mold-resistant wood, drywall and paints. If a house is new or relatively new and the homeowners think that the builder is responsible for a mold problem (by ignoring building codes, for example), they should contact the local health board or housing authority. Many county or state health departments offer mold assessment and remediation services. Homeowners and insurance professionals can also find information about each state’s Indoor Air Quality program at this website: http://www.cdc.gov/nceh/airpollution/indoor_air.htm.
Continuing education courses cover all the property and casualty claims topics agents new and old need to get ahead in an ever-changing insurance industry. learninsurance.com has state-specific mold and insurance industry CE courses for Texas and for most other states. Also available are insurance pre-license training to prepare you for your state’s license examinations.