By Jamie Lewis, Account Executive
With vacation and travel season already here, it is a critical time to evaluate the property insurance you currently write and check to see if mold coverage is appropriate for your insureds to be carrying. Mold is a growing concern among commercial and residential properties, especially along the coastal regions of the United States. At a time when hotels, resorts, condominiums, and restaurants will likely show a spike in business, they may also notice an increase in exposure for mold-related claims.
Excessive moisture is the main cause of mold growth. This can come from a defect in construction or repairs/incidents such as water pipes breaking or rainstorms. While all areas are at risk for some sort of mold damage, the humid conditions along shorelines can pose a greater threat to coastal properties. Additionally, hotels, resorts, and attached rental communities may experience a mold exposure that affects multiple units and tenants at one time. Reporting these incidents often falls by the wayside, increasing the risk of mold growth on drywall, wood, carpeting, and/or insulation. Mold spores can then be released into the ventilation system, affecting the air quality of the property.
While some property policies may provide a very limited amount of coverage for mold and mold related claims, it will likely not be enough in the event of a hurricane, circumstance causing severe water damage, or problems arising simply from long term gradual mold conditions. By offering an option for a Site Pollution Liability Policy with coverage for Mold, Fungus, and/or Mildew, you will help your clients gain the protection they need to address almost any mold exposure. Depending on the policy and limit amount purchased, mold coverage may or may not cover the high costs of issues that arise during a mold claim, including:
- Remediation Expenses
- Bodily Injury
- Property Damage
- Business Interruption
The necessary information needed in order to quote this coverage may vary depending on the carrier. A completed Premises Pollution Liability application, General Liability and Property Loss Runs, and other basic information about the building structure will be required. Multiple limit and deductible options are available and enhancements such as Transportation Pollution Liability, Illicit Abandonment, and coverage for Legionella Pneumophila are also available.
Providing clients with the correct tools, coverage, and awareness of their mold exposure is the responsibility of their insurance agents. Understanding the value of mold coverage can help property owners and managers recognize and remove potential mold quickly and effectively.
In this strained economy, tourism has decreased, resulting in coastal properties relying even more on vacationers; these businesses cannot afford to have a mold-related loss. A policy that includes coverage for fungus, mold, and mildew will help to fill in these insurance gaps and helps to secure the future success and welfare of these companies and their employees. Talk with your environmental wholesale broker today about the markets willing to write this type of coverage and the options available to your insureds.