Texas Supreme Court Upholds Mold Exclusion in Homeowners Policy
Texas / South Central News • September 1, 2006
Asked by the United States Court of Appeals for the Fifth Circuit to clarify whether a homeowners insurance policy that contains language excluding mold provides coverage for mold contamination ...
Insurance Journal is not responsible for the content of the message below.
Subject: RE: RE: Texas Supreme Court mold exclusion
Posted On: September 7, 2006, 8:31 am CDT
Posted By: temblor
Comment:
Oops. A fragment got detached.
The answer lies in the following wording, which follows the list of excluded perils:
"We do cover ENSUING loss caused by:
1. collapse of the building or any part of the building,
2. water damage, or
3. breakage of glass which is part of the building
if the loss would otherwise be covered under this policy."
This rather strange paragraph is left over from previous wording with different excluded perils, where it made more sense.
If you arrange it as I just did it is easier to understand.
This clearly says it covers collapse of the building, water damage or breakage of glass which ENSUES from any of the excluded perils.
So if there were water damage which was caused by the mold, or if the building collapsed because of the mold, or if glass (accidentally) broke because of the mold, then those damages would be covered, but not the mold itself.
Keep in mind, while many policies in other states will offer some mold coverage (mine, in Florida, gives $30,000 for mold damage and remediation) Texas courts awarded a family some astronomical amount of money a few years ago because their house was contaminated by mold. If I remember correctly, the insurer paid to repair the damage (there was no mold exclusion, but the family let the contamination go unchecked for a good while before doing anything). After repairing the damage, the family sued their homeowners insurer for their suffering (not covered under a homeowners policy) and the state courts gave them something like $30,000,000.
In that type of environment, you're not going to find many insurers offering any coverage at all.
Subject: RE: RE: Texas Supreme Court mold exclusion
The answer lies in the following wording, which follows the list of excluded perils:
"We do cover ENSUING loss caused by:
1. collapse of the building or any part of the building,
2. water damage, or
3. breakage of glass which is part of the building
if the loss would otherwise be covered under this policy."
This rather strange paragraph is left over from previous wording with different excluded perils, where it made more sense.
If you arrange it as I just did it is easier to understand.
This clearly says it covers collapse of the building, water damage or breakage of glass which ENSUES from any of the excluded perils.
So if there were water damage which was caused by the mold, or if the building collapsed because of the mold, or if glass (accidentally) broke because of the mold, then those damages would be covered, but not the mold itself.
Keep in mind, while many policies in other states will offer some mold coverage (mine, in Florida, gives $30,000 for mold damage and remediation) Texas courts awarded a family some astronomical amount of money a few years ago because their house was contaminated by mold. If I remember correctly, the insurer paid to repair the damage (there was no mold exclusion, but the family let the contamination go unchecked for a good while before doing anything). After repairing the damage, the family sued their homeowners insurer for their suffering (not covered under a homeowners policy) and the state courts gave them something like $30,000,000.
In that type of environment, you're not going to find many insurers offering any coverage at all.