Guest guest Posted April 21, 2002 Report Share Posted April 21, 2002 http://208.234.200.32/article.asp?a=top_pc & newsid=CpkFPue9ymteZndCZnJC5 The fungus among us Rough Notes - April 01, 2002 00:00 Bruce Hicks Rough Notes Indianapolis In days of old, royal hunters would lead a herd of pigs into the forests hunting for dark, moist areas that held truffles, an edible treasure that thrived in that atmosphere. Race ahead into current times and the scene changes. Lawyers are leading homeowners into the courtroom seeking coverage for damage caused to their homes because of dark, moist areas of toxic mold-a litigious treasure trove. If you're not familiar with the term " toxic mold, " you're part of a dwindling group. The subject reared its head in Texas and is now the source of market restrictions and new exclusionary language and class action lawsuits. Certain types of mold have been found to cause damage beyond wet or dry rot. Some types create air and waterborne spores that cause allergic reactions and serious illness in some people. On February 27, the Central Indiana Chapter of CPCU and The Rough Notes Co. sponsored a seminar titled " The Fungus Among Us, " at the chapter's annual All-- Industry Day. The seminar featured a panel of experts on mold-related issues, including Dr. Berry, research professor, University of North Carolina, Chapel Hill; ph Harrington, communications manager, American Association of Insurance Services (AAIS), Bensenville, Illinois; Kurt Golden, president, Bolden's Cleaning and Restoration, Noblesville, Indiana; Rieder, assistant vice president with Allstate, Northbrook, Illinois; and Hinton, loss claim specialist, Indiana Insurance, Indianapolis. Cunningham, technical training consultant, Indiana Insurance, served as moderator. He opened the seminar with examples of how the mold problem has already triggered a number of significant claims in Indiana and pointed out that understanding the exposure has to begin with an understanding of mold. What is mold/fungus? Dr. Berry noted that mold has existed for more than 4 billion years and is part of more than 1.5 million species of fungi. He added that, in his opinion, the American public is overly anxious about mold and fungi. Rather than being feared, mold should be understood and managed, he suggested. Dr. Berry pointed out that fungi play an important part in the ecological cycle, working to decompose organic matter; however, certain species of fungi are potentially harmful to humans, creating spores that can be toxic. Such toxic molds are biopollutants-living organisms that can cause an adverse effect in human beings. According to Dr. Berry, molds need three things to survive and multiply-a food source, water at an acceptable temperature and time. Sanitary water plus unsanitary surface plus time produces unsanitary conditions, which can create mold. However, he pointed out that the indoor environment is filled with elements other than mold that can create allergic reactions. Dust mites, cats and bacteria are far greater dangers to human beings than is mold. He noted that washing your hands is probably the single most effective way to reduce illness and death caused by bacteria. The human immune system is highly efficient, and adverse reactions to mold are rare. Even rarer still is a fatal reaction, Dr. Berry continued. He added that the sense of smell was very important in detecting problems. Molds excrete organic compounds, which we can smell. He said it was most important to use your sense of smell to detect and handle problems instead of masking odors. Getting rid of moisture is the best way to get rid of mold and bacteria problems. Older buildings were built in a manner that permitted a lot of airflow to remove moisture. Newer buildings and homes are sealed, so there's a much higher likelihood that moisture is trapped, creating bacteria and mold and resulting in what is termed " sick building syndrome " . Symptoms include: * Sensory irritation in the eyes, nose and throat * Skin irritation * Neurotoxic symptoms * Hypersensitivity reactions * Odor and taste symptoms The easiest way to detect possible mold problems is to look for signs of water damage on the ceiling and for sources of standing or leaking water. Flat-roofed buildings and failed ventilation systems are the greatest sources of moisture. Mold identification can be done simply by following olfactory cues. Dr. Berry encouraged the audience to visit the Minnesota Department of Health and the Environmental Protection Agency Web sites for information on mold. What is covered? Joe Harrington from AAIS discussed how AAIS's insurance products respond to mold. The information, though specific to AAIS products, is generally applicable to ISO and independent company forms. He said that personal lines property provisions typically include several areas that may trigger either coverage or exclusions. In general, coverage exists if the mold arose from a covered cause of loss or from accidental discharge of overflow from a plumbing, heating, air conditioning, or sprinkler system. Coverage would be excluded if mold arose from " errors, omissions, or defects " or if it occurred due to insured neglect. He presented examples of cases where coverage probably would exist. A windstorm might create an opening in covered property that would allow moisture into the home. Water from fighting a fire might create a moist area that is hidden from an insured where mold could grow. Coverage may exist because fire was the proximate cause. Another potential area that could trigger coverage is the increased cost to correct mold damage to meet requirements of a building regulation. This might be covered as an incidental coverage with a separate sub-limit. Coverage also may be triggered when local authorities require testing or monitoring for mold, or from laws that require homeowners to install features that act as preventative measures after mold damage is discovered. Harrington mentioned that it is important for insurers to spread to regulators and consumers the message that insurance is not a substitute for home maintenance. Property owners have the responsibility of maintaining their property and should not depend upon an insurance contract to handle poor or nonexistent maintenance. Insurance contracts and endorsements typically are written in three different ways: 1. Complete exclusion endorsement barring coverage for all mold perils (perhaps with exception of coverage for food poisoning) 2. Limited coverage for mold damage that arises from covered perils provided under an annual aggregate limit and limited liability coverage, also on an annual aggregate limit, with exception for food poisoning 3. Limited coverage for mold damage that arises from accidental discharge. Harrington emphasized that, while it might be easier to create and use absolute exclusions against mold damage, insurers should avoid hysteria and try to use approaches that respond to some losses that fall within an insured's reasonable coverage expectations. He encouraged everyone to visit www.aaisonline.org to get full information on the mold exposure. Cleaning up after mold Kurt Bolden spoke about remediation of water and mold damage. His cleaning and restoration company, which has been in business for 20 years, responds to about 1,000 water-related losses annually. In his experience, although mold and moisture problems exist in Indiana, they are much more of a problem in humid states. His business has established the " Hydrolab " which is one of only three advanced-training centers on drying structures in the country. The lab creates experiments on mold growth in various conditions and various materials. The Hydrolab has flooded its test facility more than two dozen times with 500 gallons of water-- allowing it to set from anywhere from 24 to 48 hours-and then dried the structure without any significant mold growth. Training is offered to people in both the structure treatment and insurance industries. Available also is a guide of industry standards for his industry (restoration contractors). It is called the IICRC S500 Standard and Reference Guide for Professional Water Damage Restoration. Bolden emphasized that treating sources of moisture is critical to handling mold. He also stated that it is important that the public be educated about mold. For instance, mold growth does not occur unless there is moist, organic material. Further, mold growth is not rapid and can be reduced or eliminated by keeping the environment clean, getting rid of excess water and getting rid of sources of moisture. Extracting water from wet surfaces is important, but disposal of all wet materials is usually a drastic and unnecessary step. He emphasized that mold growth takes time and that allows time for mitigation and prevention. The key to preventing mold is drying the structure. Keeping structures clean and dry is the most important element for avoiding or mitigating mold loss. Bolden suggested that restoration contractors should be able to prove to insurers and adjusters that they have expertise in handling water losses. They also should have the right training and equipment to properly detect and monitor moisture levels in key areas of a building so that a party can be sure that a structure has been dried. Personal lines mold claims Rieder pointed out that the following conditions contribute to mold problems: * Temperature * Lack of air movement * Water source * Plaintiff's bar * Public adjusters In Rieder's experience, the outbreak of mold as a serious insurance industry issue is due primarily to the publicity about highprofile mold claims. He said the problems in Texas originally arose because the state policy forms did not include " sudden and accidental " language, so coverage for mold loss existed. The state's insurers have responded by substantially increasing pricing and adding exclusions. In some instances, premiums have doubled, creating intense regulatory scrutiny and possible coverage reform. Allstate has introduced mold exclusion endorsements countrywide. In comparison, ISO created forms that allow policyholders to add optional mold coverage of $10,000 annual aggregate coverage with the ability to add increased coverage limits. Rieder pointed out that ISO's approach has the potential of creating adverse selection as well as increasing expectations of coverage and pricing difficulties due to the lack of credible data to determine the price of mold coverage. Allstate's position is to eliminate mold as an expected coverage. To do otherwise would be to continue to endanger its homeowners line's profitability and affordability. In addition, Allstate has responded to its mold experience by studying effective ways to deal with losses involving water and mold; training its personnel on these issues; and creating centralized, dedicated claims centers called " Handling Units, " that specialize in efficiently managing mold-related losses. Commercial lines mold claims Hinton stressed that, in commercial lines, mold claims can become large and complicated. It is important that insurers approach these claims by hiring a proper contractor, establishing the contractor's expertise in mitigating mold problems, and supervising the contractor's remediation efforts. An insurer must be involved in contractor selection so that mitigation can proceed efficiently. It is important that adjusters recognize and deal with mold damage, even if coverage for such damage is subject to exclusion. Hinton outlined several steps that insurance companies should use when faced with a property claim that may involve a mold loss: * Quickly determine whether or not mold damage is involved with the claim. * If coverage exists, determine how much mitigation and remediation work is necessary. * If coverage does not exist, notify the insured immediately so that he or she can minimize further loss. * Communicate openly and quickly with all affected parties, even when the news is negative. When claims arise, it's important that a claims person locate the right people to assist in investigating the loss, with a priority on establishing whether coverage exists and communicating properly with the insured. It is critical to determine whether an insured's action or inaction created the mold loss. Insurers should make it part of their practice to do the following: * Begin with a non-waiver agreement or a reservations of rights letter. * Conduct a thorough loss investigation. * Determine the cause of loss, including ruling out what did NOT cause the loss. * Decide whether the particular claim is eligible for coverage. Hinton illustrated his points by discussing a local claim that involved a very large amount of mold damage, exceeding $1 million. An inspection of the insured's building made it obvious that extensive mold damage was present. However, a detailed investigation, using specialists, revealed that two factors created the loss. One was that the insured maintained an excessively high level of humidity in the building, which created a moist environment. The second, more damaging factor involved defective construction. The building's exterior consisted of porous stone, which allowed water to enter the building where, because of vapor barriers, it collected. Mold formed and, over time, spread throughout the property. In this case, while it was definitely a mold loss, it was not covered by the insurance policy. The insured was denied coverage and the efficient, complete investigation avoided legal action from the insured. According to the viewpoints expressed by the " Fungus Among Us " panel, the insurance industry clearly has the tools to deal with mold losses-without overreacting. Copyright Rough Notes Co., Inc. Apr 2002 Quote Link to comment Share on other sites More sharing options...
Guest guest Posted April 22, 2002 Report Share Posted April 22, 2002 Dear Barbara, I am sure some of those who have mold illness and house destruction and non-payment in Indiana that have contacted me would have something to say to this spokesperson for insurance. Still they stay in a state of denial. Apparently they forgot that often they insure property without even inspecting it. That is their responsibility. They often could see the problem if only they inspected first before sale or agreement to lease said property. The insured scream foul, the insurors scream foul and the victims suffer. Like one of the local insurance guys remarked to me last week. Well the insurance company knew what they were getting into when they wrote insurance policies. They always hope to never have to pay. We live in turbulent, dangerous, and catastrophic times. I guess they were the last to know, go figure!! Maybe we could send the to counseling for constant state of denial. The fungus is that continues to grow is disbelief and denial. The other fungus we are learning to overcome. My sister owns an insurance company, and I watched her cram it down peoples throat for years, then her own husband had to collect. It was quite interesting. Carroll-Bower, NTMC www.geocities.com/marbme12/NTMC.html --- Barbara Herskovitz <bherk@...> wrote: > http://208.234.200.32/article.asp?a=top_pc & newsid=CpkFPue9ymteZndCZnJC5 > > The fungus among us > > Rough Notes - April 01, 2002 00:00 > Bruce Hicks > Rough Notes > Indianapolis > > In days of old, royal hunters would lead a herd of > pigs into the forests > hunting for dark, moist areas that held truffles, an > edible treasure that > thrived in that atmosphere. Race ahead into current > times and the scene > changes. Lawyers are leading homeowners into the > courtroom seeking coverage > for damage caused to their homes because of dark, > moist areas of toxic > mold-a litigious treasure trove. > > If you're not familiar with the term " toxic mold, " > you're part of a > dwindling group. The subject reared its head in > Texas and is now the source > of market restrictions and new exclusionary language > and class action > lawsuits. Certain types of mold have been found to > cause damage beyond wet > or dry rot. Some types create air and waterborne > spores that cause allergic > reactions and serious illness in some people. > > On February 27, the Central Indiana Chapter of CPCU > and The Rough Notes Co. > sponsored a seminar titled " The Fungus Among Us, " at > the chapter's annual > All-- Industry Day. The seminar featured a panel of > experts on mold-related > issues, including Dr. Berry, research > professor, University of North > Carolina, Chapel Hill; ph Harrington, > communications manager, American > Association of Insurance Services (AAIS), > Bensenville, Illinois; Kurt > Golden, president, Bolden's Cleaning and > Restoration, Noblesville, Indiana; > Rieder, assistant vice president with > Allstate, Northbrook, Illinois; > and Hinton, loss claim specialist, Indiana > Insurance, Indianapolis. > > Cunningham, technical training consultant, > Indiana Insurance, served as > moderator. He opened the seminar with examples of > how the mold problem has > already triggered a number of significant claims in > Indiana and pointed out > that understanding the exposure has to begin with an > understanding of mold. > > What is mold/fungus? > > Dr. Berry noted that mold has existed for more than > 4 billion years and is > part of more than 1.5 million species of fungi. He > added that, in his > opinion, the American public is overly anxious about > mold and fungi. Rather > than being feared, mold should be understood and > managed, he suggested. Dr. > Berry pointed out that fungi play an important part > in the ecological cycle, > working to decompose organic matter; however, > certain species of fungi are > potentially harmful to humans, creating spores that > can be toxic. Such toxic > molds are biopollutants-living organisms that can > cause an adverse effect in > human beings. > > According to Dr. Berry, molds need three things to > survive and multiply-a > food source, water at an acceptable temperature and > time. Sanitary water > plus unsanitary surface plus time produces > unsanitary conditions, which can > create mold. However, he pointed out that the indoor > environment is filled > with elements other than mold that can create > allergic reactions. Dust > mites, cats and bacteria are far greater dangers to > human beings than is > mold. He noted that washing your hands is probably > the single most effective > way to reduce illness and death caused by bacteria. > > The human immune system is highly efficient, and > adverse reactions to mold > are rare. Even rarer still is a fatal reaction, Dr. > Berry continued. He > added that the sense of smell was very important in > detecting problems. > Molds excrete organic compounds, which we can smell. > He said it was most > important to use your sense of smell to detect and > handle problems instead > of masking odors. > > Getting rid of moisture is the best way to get rid > of mold and bacteria > problems. Older buildings were built in a manner > that permitted a lot of > airflow to remove moisture. Newer buildings and > homes are sealed, so there's > a much higher likelihood that moisture is trapped, > creating bacteria and > mold and resulting in what is termed " sick building > syndrome " . Symptoms > include: > > * Sensory irritation in the eyes, nose and throat * > Skin irritation * > Neurotoxic symptoms * Hypersensitivity reactions * > Odor and taste symptoms > > The easiest way to detect possible mold problems is > to look for signs of > water damage on the ceiling and for sources of > standing or leaking water. > Flat-roofed buildings and failed ventilation systems > are the greatest > sources of moisture. Mold identification can be done > simply by following > olfactory cues. Dr. Berry encouraged the audience to > visit the Minnesota > Department of Health and the Environmental > Protection Agency Web sites for > information on mold. > > What is covered? > > Joe Harrington from AAIS discussed how AAIS's > insurance products respond to > mold. The information, though specific to AAIS > products, is generally > applicable to ISO and independent company forms. He > said that personal lines > property provisions typically include several areas > that may trigger either > coverage or exclusions. In general, coverage exists > if the mold arose from a > covered cause of loss or from accidental discharge > of overflow from a > plumbing, heating, air conditioning, or sprinkler > system. Coverage would be > excluded if mold arose from " errors, omissions, or > defects " or if it > occurred due to insured neglect. He presented > examples of cases where > coverage probably would exist. A windstorm might > create an opening in > covered property that would allow moisture into the > home. Water from > fighting a fire might create a moist area that is > hidden from an insured > where mold could grow. Coverage may exist because > fire was the proximate > cause. > > Another potential area that could trigger coverage > is the increased cost to > correct mold damage to meet requirements of a > building regulation. This > might be covered as an incidental coverage with a > separate sub-limit. > Coverage also may be triggered when local > authorities require testing or > monitoring for mold, or from laws that require > homeowners to install > features that act as preventative measures after > mold damage is discovered. > > Harrington mentioned that it is important for > insurers to spread to > regulators and consumers the message that insurance > is not a substitute for > home maintenance. Property owners have the > responsibility of maintaining > their property and should not depend upon an > insurance contract to handle > poor or nonexistent maintenance. > > Insurance contracts and endorsements typically are > written in three > different ways: > > 1. Complete exclusion endorsement barring coverage > for all mold perils > (perhaps with exception of coverage for food > poisoning) > === message truncated === __________________________________________________ Quote Link to comment Share on other sites More sharing options...
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