Top 10 States at Risk for Mold

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Press Release Source: GREENGUARD Environmental Institute

Top 10 States at Risk for Mold

Monday July 10, 8:00 am ET

Western Real Estate in Danger Despite Dry Climate

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ATLANTA, July 10 /PRNewswire/ -- Contrary to popular belief, climate

is not a good gauge for mold risk, according to a ranking of states

at risk for mold contamination on commercial and residential

property. Areas with dry climates like Nevada and Arizona made it to

the top ten while some Gulf States did not come close.

Because mold damage is now excluded or severely limited on standard

property insurance, concerns about the financial impact of a mold

outbreak in a home or business continue to rise.

In the relative hazard ranking model developed by American Risk

Management Resources (ARMR) and now being used by GREENGUARD

Environmental Institute (GEI), " dry states " (Oklahoma, Kansas)

intermingle with predictably high-risk mold zones (Florida, South

Carolina), but Texas beat them all:

Top 10 Relative Hazard Mold Ranking

Texas 2.95

Florida 2.50

Oklahoma 2.45

South Carolina 1.91

Nevada 1.90

Arizona 1.90

California 1.73

South Dakota 1.47

Tennessee 1.33

Kansas 1.25

Bottom 5 Relative Hazard Mold Ranking

Wisconsin .06

West Virginia .07

Alabama .13

Massachusetts .18

Minnesota .19

The GEI/ARMR relative hazard ranking model was developed by

comparing mold losses on insurance claims with premiums paid on

property and liability coverage in each of the 50 states. The hazard

ranking model does not yet reflect claims associated with 2005

hurricanes that struck the Southeastern US. Wisconsin has the lowest

relative mold loss rate, which is one-50th the loss rate in Texas

based on the relative frequency of insurance claims.

" Mention mold right now, and the Gulf Coast comes to mind first, but

the contamination on real estate hit by hurricanes was generally

less significant overall than mold growth caused by inferior

building materials or poor construction, " said Carl ,

CEO/Executive Director of GEI, a non-profit organization working

with lenders and developers on mold risk mitigation

techniques. " It's counterintuitive to think of shopping centers in

Phoenix or casinos in Las Vegas as being at risk for mold, but it

makes sense when you examine the causes of mold and problems often

caused by modern building practices and materials. "

According to , many buildings and houses in dry climates

develop mold issues when moisture is nurtured within walls and

windows that are tightly sealed off from consistently hot conditions

outside.

" Think of a glass of ice water sitting on your porch in 95-degree

heat, " said . " Condensation quickly forms on the outside of the

glass, but unlike your drink, condensation in a home or business has

nowhere to run off so it builds up in the cavities of the structure,

creating an ideal climate for mold contamination. "

As mold decreases property values, it could force many owners into

default, forcing mortgages into a " non-performing loan " category,

the worst- case scenario for lenders. That classification causes a

negative chain reaction from ratings agencies, regulatory

authorities, and shareholders.

" In the age of universal mold exclusions on insurance policies,

everyone involved in real estate needs to diligently manage the mold

risk, " said J. Dybdahl, head of ARMR, an insurance brokerage

and consulting firm specializing in environmental insurance covering

mold.

GEI recently announced a mold risk reduction program, based on a

compilation of best practices that GEI has proposed as an American

National Standards Institute (ANSI) standard. The proposed standard

has been preliminarily reviewed by the Environmental Protection

Agency (EPA) and piloted with several building owners. Building

consultancies review and assess properties based on the standard;

once this is successfully completed, property owners can apply to

GEI for certification under the GREENGUARD Mold Protection Program

. Once a property is certified, it can be promoted to lenders,

insurers and prospective tenants.

" Who is ultimately holding the financial bag for construction and

permanent mortgages along with business loans to builders? The

lender, " said . " The bank typically holds 80% or more of the

risk in these loans (since 20% is typically invested by the

borrower). Therefore, the smart lenders will work even faster to

protect themselves. "

For more information on the GREENGUARD Mold Protection Program, call

800.789.0419 or write to mold@....

About the GREENGUARD Environmental Institute

The GREENGUARD Environmental Institute (GEI) is an industry

independent, non-profit organization that oversees the GREENGUARD

Certification Program. As an ANSI Accredited Standards Developer,

the GEI establishes acceptable indoor air standards for indoor

products, environments and buildings. The Institute's goal is to

improve public health and quality of life through programs that

improve indoor air. For more information, go to

http://www.greenguard.org .

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Source: GREENGUARD Environmental Institute