Take Mold Contamination Seriously
You may have heard horror stories about toxic mold, expensive mold remediation, and denied home owners insurance claims. Yet mold can be found anywhere, including in most homes. It’s usually harmless. Mold needs moisture to thrive. Problems can arise for home owners when the presence of persistent moisture goes undetected or unresolved, leading to widespread mold growth. Moisture can result from high indoor humidity, flooding, or a leaky roof or dishwasher.
Mold can cause serious illness and property damage. With the introduction of mass-produced building products and cookie-cutter construction techniques, residential and commercial buildings have become more susceptible to developing mold contamination in any moist breeding ground. Mold contamination can destroy building products, finishes, furnishings, and belongings, and cause mild to serious health consequences to those exposed.
Mold and Home Owners Insurance
Homeowners insurance covers mold damage if it was caused by a “covered peril”. Otherwise, an insurance company will likely not cover mold damage but there are exceptions. Whether mold damage is covered by home owner’s insurance often comes down to the source of moisture. Home insurance policies usually don’t cover mold that resulted from a preventable water leak, flooding, or high humidity. Insurance companies also typically don’t pay for maintenance issues that insurers think a homeowner should have prevented. Insurers expect homeowners to proactively take care of those problems before they need to file an insurance claim.
Home insurance covers mold if a “covered peril” caused the mold. In that case, your home insurance policy will likely pay for repairs and clean-up. Here are some of home insurance’s covered perils: Fire; Lightning; Vandalism or malicious mischief; Damage caused by vehicles; Theft; Falling objects; Weight of ice, snow, or sleet; Accidental discharge or overflow of water or steam from plumbing, heating, air conditioners, sprinkler systems, or household appliances; Frozen pipes.
- An ice dam forms in a roof gutter during a rough winter and water backs up under your shingles. The water leaks into your attic, soaks your attic floor and insulation, and creates mold.
- A pipe bursts in your home and dumps gallons of water on the floor and saturates drywall while you’re at work. Mold begins to form before you call.
- A washer hose springs a leak and damages behind your washer. The washer hose isn’t old, you stop the leak, and report the damage immediately, but not before mold forms.
These are “sudden and accidental” incidents. Insurance companies typically cover this type of damage. In fact, non-weather-related water damage is one of the most common home insurance claims and one of the most expensive.
So when would your policy not cover you? Let’s say your basement pipes freeze and burst. You don’t notice it for a few weeks. Now, you have a few inches of water on your floor and mold growing. Your 40-year old roof has broken shingles allowing water into the attic. Water saturates wood and insulation and leads to mold in the attic. Or, mold forms in your shower. You don’t think much of it until one day you notice that it’s unsightly and you’re concerned about whether it’s making your family sick.
In these cases, an insurer will likely not cover the damage. Why? An insurance company expects you to take care of your house. That means properly ventilating the bathroom, replacing an old roof, and checking your basement regularly. An important reason to stay on top of home maintenance. Also, the standard homeowner’s insurance policy does not cover water damage caused by a flood. Thus, if a flood causes water damage that leads to mold, the resulting mold issue would not be covered by your home policy.
A separate flood policy will cover mold and mildew, as long as it’s not caused by the homeowner’s failure to inspect and maintain the property after the flood. That means, once you can get back into your home, you need to start trying to clean up and keep mold from growing or spreading.
It’s hard to put a precise dollar figure on mold damage because most insurers don’t separate mold claims from water-damage claims. About 22% of all home owner’s insurance claims result from “water damage and freezing,” a category that includes mold remediation. Most insurance policies have limitations on mold coverage. Even when mold damage is covered, there may be limitations on the coverage. Most policies cap coverage at a certain amount – the amounts vary, depending on a number of factors, but a typical homeowner’s policy usually covers between $1,000 and $10,000 in mold remediation and repair.
Take an hour or two to review the language of your homeowner’s insurance policy, especially as it pertains to water damage. Check to see if there are specifics about mold claims. To know for sure if your policy will cover mold damage (and what kind of limits to expect), you need to read it very carefully and make sure you understand all the coverage details. Call your agent if the wording is unclear.
You need to be proactive to protect your interests, especially in the initial phase of your loss. It’s important that you take the steps needed to ensure that you, your contractor and insurance company communicate, work together and see eye to eye on the extent of work and the costs of work needed. As a policyholder, you have the responsibility to mitigate the loss and cooperate with your insurance adjuster so that they can verify the cause and value of your loss.
Report to your carrier ASAP, no matter the time of day or night BEFORE any work begins.
Make sure the project is well-documented. Take detailed notes of every conversation, including the name, company, phone number, address, and job title of every insurance adjuster, representative, consultant and contractor you deal with. Confirm all agreements in writing. Insist that appointments and deadlines be honored. Keep a log or binder of all notes and letters. Ask for and keep business cards from everyone involved in your claim.
Ask your contractor if are willing to resolve any pricing or scoping differences with your adjuster? A quality restoration company respects the role the adjuster plays in the process and is willing to fully cooperate.
Request your adjuster to perform an inspection ASAP with your contractor. Promptly provide your contractor’s contact info to them and your adjuster info to your contractor. If possible, put them on the phone together while in your presence so they can begin the approval process.
- If a disagreement develops on scope of work or pricing between adjuster and contractor, or there are delays in inspections, call your agent and request they get involved!
The very best way to protect yourself, your family and your home from mold is to prevent it! There is no substitute for preventative measures when it comes to mold infestation. Don’t rely on your insurance to make you whole when it comes to mold. Take your health and your home into your own hands. Recognizing the sources of mold growth and the costs of letting them go is the first step to mastering the situation.