Is Mold Remediation
Coverage Clues: When and To What Degree
This year, three tornado systems tore
through the Midwest, Texas, and Oklahoma in the last two weeks of May, killing and injuring a number of people and
causing estimated insured loss of several
billion dollars. According to NOAA’s National Climatic Data Center, there is an
average of 276 tornadoes each year in the
United States. However, averages and statistics matter little to those who are dealing with the destruction in the aftermath
of these disasters.
Although much of this damage will be
insured, there are issues to consider in
determining what is covered and what is
not. One of the major concerns for partially damaged buildings, such as those
where roofs are torn off or walls breached
but the property remains standing, is the
occurrence of mold that so frequently follows these types of disasters.
Almost two years ago to the day, I wrote a Claims Magazine column about the property and casualty insurance implications of the 2011 tornado season. Unfortunately,
because of occurrences of this late spring and early summer, it has
become necessary to revisit this topic again.
The Centers for Disease Control and
Prevention (CDC) recommend that damaged buildings be cleaned up and dried out
within 24 to 48 hours after disasters in order to help prevent mold from developing.
Building owners are urged to open doors
and windows and to use fans to dry out
their structures. All porous materials that
have been wet for more than 40 hours can
remain a source of mold growth, according to the CDC, and therefore should be
removed or dried thoroughly. People who
are allergic to mold may become short of
breath, according to the CDC, and those
with weakened immune systems and
chronic lung disease may develop mold
infections in their lungs. The CDC and the
Federal Emergency Management Agency
(FEMA) recommend that building owners store items outside of their buildings
until insurance claims can be filed.
Prior to the 2002 edition of the standard
commercial property form, the exclusion
for mold was inferred from an exclusion
for “rust, corrosion, fungus, decay…”
Mold was not specifically mentioned in
the special causes of loss form. Because of
that, it could be reasoned that mold arising from another cause of loss—such as a
windstorm—would be covered as a continuation of the original, covered loss.