Because a broken water pipe is a covered leak, any resulting mold is considered a subsequent loss and can be covered up. An absolute exclusion means that regardless of how the mold forms, the insurance company won't pay for the damages. But, you might ask, mold was caused by a water leak, and the water leak is a covered fact, so my policy will cover damage caused by mold, right? Unfortunately, that's probably wrong. Most policies that exclude mold or mildew usually go further and specifically stipulate that any loss caused by mold is not insured, regardless of the cause, and even if other causes (covered or not) acted simultaneously to cause the loss.
For example, water seeps from the ceiling and damages hardwood floors. Damage to the floors is likely to be covered. But let's suppose that before the water leak is discovered, the leak also causes mold to start growing on the walls. That mold damage will be excluded in most mold exclusions.
Some insurance policies completely exclude mold. This means that, regardless of the cause of the mold, the insurance company won't pay for the damage. These are rare in homeowners insurance, but you should find out if your policy has one. Homeowner policies rarely cover outdoor flooding, so mold caused by a flood isn't usually covered.
Likewise, it found nothing ambiguous in the total exclusion of pollution or the exclusion of mold from homeowners' own policy, which concluded that they were correctly applied to deny coverage under the homeowners insurance policy. However, as long as there are other creditworthy defendants, plaintiffs, such as tenants, building owners, and employees, will continue to file mold lawsuits. State Senator Ortiz introduced a bill that includes the Toxic Mold Protection Act, which requires the State Department of Health Services to adopt specific regulations to protect public health against mold. The jury said that Farmers Insurance failed to promptly cover the repairs needed for a water leak, allowing toxic mold to invade Melinda Ballard's 22-room farm.
The owner of the house stated that the house had become unlivable due to the contractor's negligence in a bathroom, which caused a water leak, which caused the formation of mold and, later, the release of the chemical trichothecene in the residence. While health problems can be an issue in these types of litigation, the main thing is to recover damages caused by remediation and reconstruction, rather than proving that exposure to mold caused the medical conditions of the occupants. It did not exclude mold growth and damage that occurred as a result of a claim covered for water damage. As a result, the insurance industry faced tens of thousands of claims across the country for mold damage related to claims covered for water damage, with hundreds of millions of dollars at stake, in addition to a lengthy and costly litigation process.
An Arizona court recently ruled that mold was not included in an insurance policy's pollution exclusion.
