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Recommendations for Handling Mold Claims
Just a few years ago, most agents had never handled a mold contamination claim. Recently, however, media coverage, combined with a handful of large verdicts, have fueled an explosion of mold claims across the United States. The actions that an agent takes in the handling of a mold claim can have a large impact in an eventual lawsuit by an insured. The following are recommendations for an agent to follow in the course of handling a mold claim to help avoid and/or defend such a lawsuit.
When a claim is reported that involves mold and/or water intrusion that could lead to mold growth, time is of the essence. Contact the insured immediately and document such contact. Read the policy, identify coverage issues, and communicate any coverage issues to the insured within applicable statutory deadlines. Set up an inspection within a few days of the assignment. Document the inspection thoroughly with information such as: 1) the source of the water; 2) whether that source has been repaired; 3) which areas of the structure were affected; 4) whether any water remediation efforts have been undertaken, and, if so, specifically what methods were used; and 5) how long the areas exposed to water were wet. After the inspection, if mold growth is evident, consultation may be necessary with the following types of experts: 1) construction (to define and fix the source of the water intrusion); 2) indoor air testing (to determine the levels of mold before and after remediation); 3) mold remediation (to determine what steps are necessary to remove the mold from the structure and possibly perform the removal work); 4) possibly structural (to repair the structure after the mold removal if necessary); and 5) possibly medical (if physical problems are alleged). Although the causal connection between mold exposure and physical problems is far from clear, in cases involving mold infiltration, alternative living arrangements should be considered.
Most insured are nervous about mold claims. Be in constant communication with the insured regarding the status of the claim, and always document such communication thoroughly. Return phone calls promptly. These simple courtesies often mean the difference between a satisfied insured and a disgruntled insured who may initiate a claim or lawsuit against his agent.
Recommendations provided by:
Dwayne J. Hermes
Shari A. Keely
Hermes Sargent Bates, L.L.P.
Dallas, Texas
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