Ballard's Mold Case

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Best's Review (Prop/Casualty)

September 1999

Mold: A growing problem

By Lynna Goch

Stachybotrys, a greenish black, slimy mold that feeds off water and

construction material, could become a substantial risk to insurers.Already

it's causing problems for the Fire Insurance Exchange, a member of the

Farmers Insurance Group, Los Angeles.

A policyholder in Texas recently sued the insurer for $ 100 million for

failing to resolve a homeowners claim concerning mold infestation. The

homeowner says the home has to be completely replaced because of massive

stachybotrys infestation. Farmers describes the case as " technical " and

hired a team of consultants, including a certified hygienist with mold and

fungus expertise, in addition to making payments on the claim totaling more

than $ 100,000.

The case began with an ordinary plumbing leak. The mold grew in the

water-damaged subfloor and spread throughout the house. Similar environments

can be created by flooding or a Health hazard: Stachybotry's mold grows in

damp conditions, such as those caused by flooding or plumb ing leaks.

backed-up sewer,

Because it can cause severe health problems-including headaches, coughing up

blood and Chronic Fatigue Syndrome-the mold must be removed carefully, say

experts at the Indoor Air Solutions Inc., Pottstown, Pa.

The Utah Department of Health's Bureau of Epidemiology recommends removing

all water-damaged material once the mold is present. Major cases of mold

growth should be removed by qualified technicians wearing protective

clothing, said Maloch of the University of Toronto.

The Centers for Disease Control and Prevention of the Public Health Service

also are investigating a link between infant pulmonary hemorrhaging and the

stachybotrys mold.