Florida Dept. of Insurance Sells Out

December 19, 2002

94d0600b0074.html

Insurer to limit toxic mold claims

By Jeff Ostrowski, Palm Beach Post Staff Writer

Thursday, December 19, 2002

Florida regulators this week agreed to let a Gainesville-based homeowners

insurer limit claims stemming from toxic mold, marking the first state

guidelines covering what carriers say could be an explosive and costly

problem.

In its settlement with Florida Farm Bureau Insurance, the Florida Department

of Insurance capped the carrier's responsibility for mold claims at $10,000

per incident a year and $20,000 total.

Starting March 1, Florida Farm Bureau's 100,000 policy holders will be able

buy extra mold coverage. For $60, a homeowner can boost coverage to $25,000

per incident a year and $50,000 total. For $90, the limit climbs to $50,000

in a year but the total cap remains at $50,000.

Toxic mold typically results from water damage and can sicken people who

come in contact with it.

Spurred by a flood of mold claims in Texas, Florida Farm Bureau and 237

other homeowners insurers asked state regulators to limit their mold risk.

While the state put those requests on hold, Florida Farm Bureau and State

Farm asked for immediate decisions, leading the Department of Insurance to

reject both companies' mold filings. Both appealed to the state Division of

Administrative Hearings.

Florida Farm Bureau and the state negotiated a settlement before a judge

ruled on the matter. An administrative judge is scheduled to hear State

Farm's appeal Jan. 13.

Department of Insurance spokeswoman Tami called the deal " very

reasonable, " but neither she nor officials at Florida Farm Bureau or State

Farm would say whether these guidelines will serve as a model for other

carriers.

While Florida Farm Bureau had asked for a $10,000 limit on mold claims,

State Farm has asked for a complete pass on mold claims, although it also

has offered to sell additional mold coverage.

Florida Farm Bureau's customers are mainly in northern and central Florida,

although an official said the insurer has " several thousand " policies in

Palm Beach County and the Treasure Coast.

jeff_ostrowski@...

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