As New Orleans residents and business owners return to some of the hardest-hit neighborhoods, one of the toughest cleanup chores facing many is mold — a blight, many are learning, for which their insurance may offer little help.
Increasingly, insurance policies are limiting what property owners can recover for damage from the mold that sprouts after flooding or other water damage in warm climates. A growing number simply exclude mold damage altogether, leaving policyholders to pay for remediation costs themselves.
The policy disputes are surfacing slowly in New Orleans, in part because of the difficulties insurers have had processing claims. Insurance companies have sent as many as 15,000 adjusters into Louisiana, Texas, Mississippi, Alabama and Florida since Katrina hit and Rita followed. But the adjusters are having the same problems as homeowners getting into the most heavily damaged areas.
“Getting in and out of the city is a challenge,” with many Baton Rouge-based adjusters spending two to three hours in traffic during 15-hour days, says Robert Phillips, a catastrophe team manager for State Farm Insurance Cos., which has logged more than 200,000 homeowners-insurance claims from the hurricanes in Louisiana alone
With New Orleans’s extensive flooding, “you’ve got all the perfect conditions for mold — you have humid, high temperatures,” says Ron Bielinski, an industrial hygienist, architect and engineer who has been working in the Gulf Coast inspecting damaged properties for insurers.
Throughout once-flooded neighborhoods, contractors have posted signs advertising home-gutting services. “Got Mold?” says a common one, offering a telephone number. At Red Cross aid centers or anywhere they run into one another, residents trade tips: whether to spray walls with bleach to arrest mold’s spread, whether to turn on air conditioning, how much drywall to remove.
A booklet from the Federal Emergency Management Agency and the American Red Cross, “Repairing Your Flooded Home,” recommends opening windows and airing out the house to help it dry out — potentially for several weeks — and hosing and shoveling out mud and silt, cleaning ductwork and throwing out soaked wallboard and muddy insulation.
The federal Centers for Disease Control warns that mold sprouting up after a natural disaster can irritate eyes, noses and lungs, inflame asthma, allergies and other breathing problems.
In a soaking, many modern building materials absorb water and contaminants, then mold rapidly. Mold can even colonize wooden structural elements like joists and wall studs, particularly if they have stayed wet for long, Bielinski says. Contaminated wood must be removed and replaced.
The issue of mold and insurance is tied up in the debate over flood coverage, which has heightened since Hurricane Katrina hit the Gulf Coast Aug. 29. Private-sector insurers face an estimated $60 billion in insured damage, a figure that assumes Mississippi’s attorney general isn’t successful in forcing the companies to pay for extensive flood damage that they say is excluded from the policies.
Standard homeowners policies for decades have excluded flood damage to homes; insurers have argued that flooding is too devastating and too costly when it occurs. Homeowners and smaller businesses can buy coverage from the National Flood Insurance Program, a part of FEMA, but policies generally pay a maximum of $250,000 in rebuilding costs.
Ultimately, the phrasing of individual homeowners’ policies may make the difference to policyholders like Beatriz and Bill Brockman. The Brockmans are among the lucky ones — relatively speaking: While their three-bedroom ranch house in Kenner, a New Orleans suburb near the airport, was inundated by 10 to 12 inches of water, the flooding was without the dense sludge found elsewhere in the metropolitan area. But dense carpets of mold sprouted on the Brockmans’ walls, furniture — indeed, anywhere the water touched and even nearby places it didn’t. “It’s that fuzzy, powdery green mold,” Mrs. Brockman says, much like what grows on rotting oranges.
For the Brockmans, cleaning up has meant spraying walls with bleach solution, packing up everything that can be salvaged, hauling out what can’t and tearing out sodden carpets, so contractors could cut 4-foot-high swaths of wet, moldy drywall from the house.
Mrs. Brockman worries it isn’t enough, particularly since two daughters have asthma. After reading government and private-sector cleanup guidelines, she believes at least 6 feet of drywall should be removed. After that, the Brockmans and others say they have been told, the house should dry out for six weeks; only then should wooden wall studs be tested to see if mold has permeated them as well; if so, razing the house may be the only option.
The Brockmans, who have insurance from both State Farm and the federal flood program, have hired an independent adjuster to help them through the claims process. State Farm’s adjuster was sympathetic but told the Brockmans she couldn’t pay anything extra for cleaning up mold — such as that now infesting the air-conditioning system — beyond the cost of repairing the water damage, Mrs. Brockman says.
“We are blessed with a house to rebuild,” says Mrs. Brockman, who worked for an office-supply store and a tutoring service before Katrina hit. “But to reconstruct it so that it’s a clean and safe and sound place to live is maybe more than our household budget can handle.” A State Farm spokesman says the company adjusts each claim on its own merits, and the specific remediation is based on such factors as how long a property was flooded.
Flood-insurance policies from the federal insurance program typically pay to remove mold. As mold claims proliferated in the 1990s, especially in Texas, many private-sector insur-ers began limiting cleanup of mold from any cause; some policies now exclude mold coverage.
