DOI May Hold Mold 4th Hearing in Tallahassee, Rule on Filings Within 30 Days

[Guest guest]

http://www.flains.org/newfic/mediapublic/

August 20, 2002

DOI May Hold Mold 4th Hearing in Tallahassee, Rule on Filings Within 30 Days

The Florida Department of Insurance may hold a final hearing on property

insurance coverage of mold in Tallahassee and it will rule on more than 400

exclusions and endorsements involving mold within 30 days. And DOI is, at

least, considering approving exclusions for general commercial liability and

then asking carriers to offer coverage after they have had time to more

thoroughly analyze the situation.

These developments emerged from a four-hour hearing Monday in Temple

Terrace, a Tampa suburb. It was the third conducted by DOI on the mold

filings in the last three weeks. Only four consumers testified at this

hearing, compared to about a dozen in Orlando and two dozen in Plantation in

Broward County. Other consumers apparently attended because the Temple

Terrace City Council Meeting Room, which holds 100 people, was packed. There

was also testimony from representatives of water extraction and mold

remediation companies.

Elsie Crowell, Florida Department of Insurance consumer advocate, attended

the hearing, her first. Also attending was House Insurance Chairman

Waters, R-Largo, who lives in the Tampa Bay area.

Representatives for FIC and the Florida insurance community included:

Stander, Alliance of American Insurers, Tallahassee; Vince Rio,

State Farm, Tallahassee; and Goldberg, American Insurance Association,

Washington, D.C.

Stander focused on the impact of the new explosion of mold claims and

litigation on commercial liability insurance, including coverage for

builders, plumbers and others in the construction industry and coverage for

condominium homeowners associations. Many carriers have filed exclusions or

sought limits on the coverage because of " this rather vague and scary risk

staring them in the face. "

Steve Roddenberry, deputy director of the Division of Insurer Services and

chairman of the DOI panel conducting the mold hearings, asked Stander a

significant question. If DOI approved a general commercial liability

exclusion for mold coverage, gave carriers a period of time of assess the

risk and situation and then asked for filings providing a degree of

coverage, would the carriers react favorably?

" If we can quantify this risk, and in doing so, get a handle on the

litigation environment, if the Centers for Disease Control and the National

Institute of Health issue guidelines based on scientific evidence covering

testing and remediation, and if we can get rates that actuarially allow us

to make a profit, yes, carriers would offer the coverage, " Stander replied.

Roddenberry did not have a similar question for homeowners insurance and he

did not indicate which way the department might be leaning.

State Farm's Rio and Craig Duncan, a State Farm agent from Clearwater, urged

the department to make coverage for mold under a homeowners policy optional,

like a flood policy or endorsement providing coverage for backflow from a

sewer or drain. Rio, also representing the Insurance Council, said DOI

should let each carrier decide on the details of its particular exclusion or

endorsement and should approve all of the filings which have been made over

the last several months.

Tami , press secretary to Insurance Commissioner Tom Gallagher, told

reporters a fourth hearing may be held in Tallahassee soon, although that is

not definite. In addition, Ms. said, DOI hopes to rule on the various

mold filings in about 30 days.