Conn. Mold Bill Reportedly Runs Counter to Most DOI Regulations

A Connecticut Senate bill that would reportedly prohibit insurers from excluding mold damage from their coverages would make residential property insurance coverage less available and more expensive in the state, according to an industry trade association.

S.B. 417, An Act Concerning Insurance Coverage for Damage, would prohibit insurers from excluding or limiting mold coverage from commercial or personal property coverage, except that the policy may include a minimum aggregate limit of $50,000 for loss from mold or remediation.

“With the notable exception of New York, more than 40 state insurance departments, including Connecticut’s, have approved the ISO (Insurance Services Organization) mold exclusions for homeowners and property policies,” said Gerald Zimmerman, assistant vice president and regional manager of the Property Casualty Insurers Association of America (PCI). “This bill would run counter to the ISO model’s intent and seriously compromise homeowners’ coverage in Connecticut.

“All mold growth arises from moisture, and its prevention and removal comes down to a basic home maintenance issue,” continued Zimmerman. “As such, insurers are well within their rights to exclude it from policy coverage.”

The bill is scheduled for a hearing this week in the Senate Insurance Committee.