Does Homeowners Insurance Cover Mold?

Homeowners insurance and mold remediation

Whether or not your homeowners insurance covers mold damage depends on your location and your specific policy. Most insurance companies exclude mold from homeowners coverage but provide the option of adding coverage via endorsement. Some home insurance companies offer reimbursement for mold remediation if the mold was caused by a covered peril.

This article provides details on covered perils and homeowners insurance mold endorsements. 

1. When is mold covered by homeowners insurance?
2. When is mold excluded by homeowners insurance?
3. Preventable tips and additional resources

When do you have insurance coverage for mold?

Confirm your homeowners insurance mold coverage by checking your insurance policy. Mold is a potentially costly claim with a difficult-to-determine root cause, so most insurance companies won't insure against it outright. You may need to add a “limited fungi or microbes coverage” endorsement to your home policy.

Limited fungi or microbes coverage

This coverage provides additional — but limited — coverage for mold remediation as part of your homeowners policy. A typical mold endorsement covers damages up to $2,500, covering:

• Cost of removing fungi/microbes
• Cost of tearing out and replacing affected area(s)
• Cost of testing air quality after mold removal 
• Cost of residing elsewhere if your home is unliveable because of mold

In order for this coverage to apply, the mold or fungi must result because of a covered peril. What constitutes a covered peril varies by policy type. If you have an open peril policy (or all perils policy), you have coverage for anything not specifically excluded from your policy. 

With a named peril policy, you are only covered for those incidents explicitly stated in your policy documents. Most policies insure your dwelling (the physical structure of your home) on an open peril basis but your personal belongings on a named peril basis. 

Below are the 16 named perils on most homeowners policies:

• Lightning or fire
• Hail or windstorm
• Damage caused by aircraft
• Explosions
• Riots or civil disturbances
• Smoke damage
• Damage caused by vehicles
• Theft
• Vandalism
• Falling objects
• Volcanic eruption
• Damage from the weight of snow, ice, or sleet
• Water damage from plumbing, heating, or air conditioning overflow
• Water heater cracking, tearing, and burning
• Damage from electrical current
• Pipe freezing

A major exception occurs if the mold is the result of constant or continual leakage of water. For example, if you’ve had a leaky sink for weeks, months, or years, and microbes have formed, you will not have coverage. If water damage from a burst pipe causes mold to form in your home's drywall, you would have coverage under this endorsement.

When is mold excluded from home insurance?

Mold remediation is not covered by homeowners insurance if:

1. Your insurance policy specifically excludes it and you do not have an endorsement.
2. The mold occurred as a result of maintenance issues.
3. The mold was caused by a flood. 

More information on these circumstances:

1.) You do not have Limited Mold and Fungi Coverage endorsement and your policy excludes mold coverage.

Many policies will exclude mold damage but provide the option to add it via an endorsement. If your policy excludes mold remediation coverage and you do not have an endorsement, you will have no coverage in the event of mold.

2.) Your mold or fungi remediation needs occur as the result of a long-term leak.

Insurance companies require you to take any and all necessary steps to protect your home. If you ignore or fail to notice a leak, they will not deny coverage. Like most insurance claims, your mold damage needs to be the result of sudden or immediate action.

3.) The mold development was the result of flood damage.

Home insurance will not cover damage associated with flooding. In order for your coverage to apply, you need to buy a separate flood insurance policy via FEMA.

Mold remediation and prevention tips and resources

In order to prevent the spread or creation of mold growth, follow our key steps.

• Manage moisture in basements, corners, ceilings, closets. Consider a dehumidifier if necessary.
• Regularly check your air conditioners, pipes, and plumbing for slow leaks — especially during warmer months.
• Be aware of dust — mold’s main food. Vacuum regularly.
• If you see mold, call a professional and avoid non-chemical solutions.