Indoor mold called next health crisis

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http://web.star-telegram.com/content/fortworth/2001/06/27/state/fw010408-062

7-XB001-mold.htm

Wednesday, June 27, 2001

Indoor mold called next health crisis

By R.A. Dyer

Star-Telegram Austin Bureau

AUSTIN - Indoor mold contamination has damaged the public's health and

destroyed homes, according to witnesses during a first-ever public hearing

Tuesday on what insurance industry executives call a looming crisis. " Gone

unchecked, mold-related cases could rival those of tobacco liability in the

not-too-distant future, " said Ray, spokeswoman for Southwestern

Insurance Information Service. AUSTIN - Indoor mold contamination has

damaged the public's health and destroyed homes, according to witnesses

during a first-ever public hearing Tuesday on what insurance industry

executives call a looming crisis.

" Gone unchecked, mold-related cases could rival those of tobacco liability

in the not-too-distant future, " said Ray, spokeswoman for

Southwestern Insurance Information Service.

Insurance Commissioner Montemayor called the hearing after receiving

requests from the industry to limit its liablity to mold-related claims.

Intense public interest prompted Montemayor to move the hearing from his

regular chambers to a 1,000-seat auditorium at the University of Texas.

The hearing drew 500 to 600 people, including many homeowners who complained

bitterly about their treatment by insurance companies. Some homeowners

arrived in buses from across the state.

Insurance industry executives, by contrast, expressed concern about

financial losses. A recent increase in mold claims - as well as a $32

million jury award to a Dripping Springs family this month - appears to have

caught the industry by surprise.

" We are going to have to seek some solutions to what appears to be a

good-sized problem, " Montemayor said. " My job is to make sure that every

Texan has the coverage they need for the best possible price. "

Melinda Ballard, the Dripping Springs homeowner who recently won a

high-profile mold case against her insurer, told Montemayor that adjusters

often drag their feet in correcting mold problems.

" Toxic mold is the result of untimely mitigation to water damage, " she said.

" We should be putting new restrictions on insurers, not excusing bad

behavior. I would like to see the insurance industry exercise prevention. "

Officials from the federal Environmental Protection Agency and the Texas

Department of Health also warned that mold contamination can cause serious

health problems.

Kay Soper, an indoor air quality specialist with the state Health Deparment,

said such contamination often results in allergy-type symptoms, although

certain mold-related toxins can have more serious effects.

Those toxins - known as mycotoxins - have been blamed for nausea, central

nervous system damage and cancer, according to an EPA report.

" We recognize mold as a problem - it's one of the main indoor problems we

run across, " Soper said. " It's been a problem for a good number of years,

but we have seen a skyrocketing interest in this " in recent months.

Montemayor also heard testimony that no government standards exist for

acceptable levels of mold in private homes, nor do standards exist for the

certification of professionals who remove mold.

Neither the Insurance Department nor the industry has statewide figures on

the apparent increase in mold-related claims.

Citing that lack of data and standards, industry representatives called for

limits to their liability for mold damage. Farmers Insurance Group has

called for the insurance commissioner to remove mold coverage completely

from homeowner's policies.

One executive said Tuesday that such claims could prompt homeowner's

premiums to increase by as much as 40 percent. Another said that

mold-related claims in one part of Texas have gone from 20 per month in

January, to over 150 so far this month.

" I think there is an element of hysteria involved, " Tom , outside

legal counsel for Farmers, said Tuesday. " When you have busloads of people

coming to a hearing like this, there is an element of hysteria involved.

When you have plaintiff's lawyers fanning the flames, there is hysteria

involved. "

Montemayor said he plans at least two more public hearings and doesn't plan

to rule on mold coverage for several months. He also said the Legislature

may conduct hearings before reconvening in 2003.

A typical homeowner's policy covers mold-related damage whenever it is

caused by an insured event, such as a broken water pipe or a storm-damaged

roof, according to an insurance department spokesman.

R.A. Dyer, (512) 476-4294

rdyer@...