2005
Insurance Reference Manual
Personal Insurance Federation of California Insurance Reference Book
MOLD AND INSURANCE
An Overview.
Molds occur naturally and can be found in all indoor and outdoor environments. Everyone is exposed to them daily in the air we breathe. Molds are simple microscopic fungi that live in plant or animal matter. In fact, mold has been around since the beginning of time and is noted in the Old Testament of the Bible (Leviticus, Chapter 14). So, with something that has been around forever, why all the fuss today over mold growing in homes, apartments and commercial buildings throughout the United States?
First, it is important to understand that not all mold is bad. They are found on plants, foods, dry leaves, and other organic material. Mold travels through the air in the form of spores. Spores are lightweight and tiny, thus they are able to travel through the air, in water or on insects. When mold spores land on a moist area, they may begin growing and digesting whatever they are growing on in order to survive.
Mold spores enter homes and buildings through open doors and windows, heating units, and ventilation and air conditioning systems. When excessive moisture or water accumulates indoors, mold growth may occur, particularly if the moisture problem remains undiscovered or unattended.
Are Molds Toxic?
There is no definitive study on mold that breaks the hundreds of thousands of species of fungi that exist into categories or standards of what is good or bad mold. In fact, there are no existing federal or state standards that tell what constitutes acceptable or unsafe levels of exposure to molds in indoor air environments. Also, there is no standardized test currently recognized by state or federal agencies or by the courts for determining what types or levels of mold a person has to be exposed to before health problems occur.
According to the American Conference on Governmental Industrial Hygienists, there is insufficient information or studies to establish threshold limit values for molds in residential environments. Medical and scientific experts agree that more extensive studies are needed before any conclusions can be drawn regarding the health impacts or acceptable levels of mold exposure.
Sensitivities to molds vary significantly among individuals. Persons with pre-existing allergy conditions or particular health problems may be more susceptible to physical symptoms related to mold exposure. For example, according to the Centers for Disease Control, the most common symptoms associated with mold exposure are allergic type respiratory symptoms similar to those experienced by persons with hay fever.
When molds are present in large quantities, they can cause allergic symptoms similar to those caused by plant pollen in some individuals who are susceptible to mold allergies. Molds may also be a factor in triggering asthma episodes, infections or other respiratory problems for certain susceptible people. However, for most people it would take exposure to an extremely large amount of mold to cause these types of reactions.
The Center for Disease Control, the National Institutes of Health and the Environmental Protection Agency have all said there are no universally accepted scientific links to mold and health. Leading scientists, government and research agencies have not developed any conclusive findings about the health impacts of mold.
In 2001, the California Legislature enacted Senate Bill 732 by Senator Deborah Ortiz, which requires a study of mold to be conducted by the California Department of Health Services to determine remediation standards and permissible exposure levels related to mold. Unfortunately, the funding for the study has yet to be approved.
Scare Tactics Used in Mold Claims
The sensational atmosphere that surrounds court cases where plaintiff's lawyers utilize health scare tactics to gain pre-trial publicity before a mold case goes to trial is rampant. Several law firms have opened web sites inviting homeowners to learn about mold, lawsuits and insurance claims. An example of such a web site is www.rvclaw.com.
In recent years, millions of Americans have viewed national television network programs over the past year, all featuring mold as an issue relating to health problems. Major newspapers and magazines like Time , People , the Wall Street Journal and New York Times have featured stories on mold as it relates to health. Local California television news programs and newspapers have run highly charged stories reaching near hysteria on how mold has destroyed homes, commercial buildings and apartments. They report that the health of family members and office workers has been destroyed due to the mold inside buildings. Although little if any qualitative or quantitative scientific data is reported in these stories to verify the causal connection between these alleged health problems, plaintiff's lawyers are all too willing to go on camera or be quoted about how mold destroyed their client's health and alleging that the insurance company is to blame for not settling a claim without questioning the veracity of the health claims.
Cottage Industry of Remediation Firms Flourishing
Exacerbating the mold hysteria is the sudden emergence of a cottage industry known as "mold remediation firms." These firms consist of self-proclaimed mold "experts" who conduct testing and remediation for expensive fees. However, there are currently no state standards, criteria or other requirements for certifying mold remediation experts. Thus, homeowners have no way of determining the legitimacy or qualifications of mold remediators.
In some cases, outright fraud by so-called remediation experts has been perpetrated. A 2002 news report published in the Caller Times, a newspaper located in Corpus Christi, Texas, reported that a remediation company sent space-suit clad employees into homes and promptly declared the homes unfit to live in because of the existence of an abundance of toxic mold. The family notified their insurance company and moved into a rental property later found to be owned by the remediation firm. When the remediation company was prosecuted for fraud, it was learned that as soon as the family moved out, the remediation crew sprayed the inside of the home with water, closed all windows, doors and vents and then turned on the heat until mold spread throughout the house. This practice is called "cooking the home" and is just one example of how fraud can be perpetrated by utilizing the sensationalism and hysteria surrounding mold insurance claims.
Government and Industry Should Educate Consumers About How to Prevent and Eliminate Mold.
While research is underway to classify molds and determine any health-related links to mold, government and industry should work together to educate consumers about how to prevent and eliminate mold. Renters, homeowners and business owners should be educated about steps they can take to prevent mold - steps such as preventing water intrusion (fixing leaky pipes and hoses), making sure areas that are prone to moisture (showers and bathrooms) are properly ventilated, keeping foundations dry, and providing adequate drainage.
How to Detect Water Problems (Tips from the Insurance Information Network of California )
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Look at your water bill. By comparing monthly usage figures, you may get tipped off to a small leak before it becomes a big problem. Major, unaccounted fluctuations in your water bill are often a sign of water leaks.
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Use a water pressure gauge to determine whether your household water pressure is set too high. The ideal household pressure is 60-80.
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Inspect pipes and fittings each year in your home. Especially check around washing machines, sinks, lavatories, ice makers and water softeners.
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When you go out of town, turn off the water.
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Outdoors: clean out gutters and downspouts of leaves and other debris regularly.
1 U.S. Environment Agency, Indoor Air Quality Report, 2001
2 California Department of Health Services Indoor Air Quality Info Sheet, 1998.
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