Is Mold Damage Covered by my Homeowners Insurance?

We’ve all been there. 

Suddenly you notice that dreaded black, brown, white, green, yellow, grey, or even red (yuck, why are there so many colors?!) growth in your basement, bathroom, or another high-humidity area of your home.

In fact, at Berry Insurance, we regularly receive calls from our clients, inquiring if their insurance covers mold growth in their home (especially during wet, rainy times of year).

The thing is, mold has many causes, and whether or not mold damage is covered by your home insurance is based on its origin.

Typically, mold damage is only covered if it is caused by a “covered peril,” meaning a water damage situation already covered under your homeowners policy, but with so many opportunities for water damage and mold growth, it may be difficult to understand when it is and isn’t covered.

Below, we’ll talk about various mold damage situations and explain which are and are not  likely to be covered by your insurance.

What causes mold damage?

Mold is essentially a common fungus that grows on various surfaces in the presence of water or humidity. It develops on paper, tiles, wood, fabric and other materials that have been exposed by moisture, making it technically “water damage.”

Therein lies the answer to whether or not mold is covered by your homeowners insurance. If mold is water damage, and you understand how your homeowners insurance covers water damage, you know how it covers mold.

Don’t know when water damage is and isn’t covered under your home insurance policy? That’s OK — let’s get into it.

When water damage (mold) is covered by homeowners insurance?

Homeowners insurance generally covers a wide range of water damage situations, including mold damage and removal, if they are considered “sudden and accidental.”

Sudden or Accidental Discharge

Homeowners insurance covers sudden water discharge, such as from a burst pipe, water heater rupture, or washing machine or dishwasher failure.

That means if a pipe bursts in your basement and causes mold, those damages would likely be covered through your insurance.

Overflow

If water overflows from a clogged toilet or sink (it happens to the best of us) and causes mold damage, that damage will be covered by homeowners insurance.

Storm-Related Water Damage

Homeowners insurance will also cover any water damage resulting from storms such as hurricanes, snow/ice, tornadoes, and more.

For instance, inclement weather causes a tree to fall on your home, insurance will also cover the mold and any other types of water damage resulting from the incident.

Mold caused by high humidity or rain simply seeping into your home or flooding your basement is not covered, but we’ll get into that more below.

Sewer backup or water backup (available at an additional cost)

While not automatically covered in your homeowners insurance policy, water backup coverage can be included for an additional cost.

This insurance will cover mold and other damage if a pipe, drain, sewer line or sump pump backs up and causes an overflow in your home.

This is different from the “overflow” coverage listed above because the backup occurs deeper within the plumbing system than the drain. 

For more information on water backup and overflow, check out this guide: Water Overflow vs. Water Backup: What’s the Difference?

When water damage (mold) isn’t covered by homeowners insurance:

Typically, it is rare for mold to be caused by one of the covered scenarios above because the water will usually be cleaned up before the mold develops.

Mold damage is usually caused by a situation that is not covered by home insurance, which we will explain below.

Gradual damage

As we already mentioned, homeowners insurance typically only covers water damage that is sudden and accidental, so gradual water damage, or water damage resulting from poor maintenance usually isn’t covered.

For example, if you have a small drip under your kitchen sink that you ignore for months, the mold it will eventually cause on your cabinets, floors, walls, or ceilings is considered gradual.

Because the leak could have been easily fixed before it caused any damage, insurance companies will not pay for this type of claim

Some gradual mold damage causes include:

• Water seepage into your home from cracks in the foundation
• Leaks around roofs, windows, and doors
• Leaks in plumbing
• Poor or improper installation of appliances or units such as ventilation systems

In most cases, mold growth is caused by gradual damage. If this is the case for you, it will not be covered by insurance.

Flood damage

Homeowners insurance does not cover damage from floods, which can have a variety of causes including thawing snow, a rain storm, a river or creek overflowing, or even a neighbor’s pool draining into your home.

If you want to be protected from flood damage, you will need to buy a separate flood insurance policy.

If you have flood insurance, mold caused by floods will be covered under that insurance. 

Know your home insurance limits and options:

If you do have a covered mold claim, your homeowner’s insurance deductible you selected when you got your policy will apply before coverage kicks in. In some cases, the cost to repair your mold damage may be less than your deductible, so you may not want to file a claim.

You will also only be paid up to the dwelling and personal property coverage limits on your policy. Usually, there is also a $10,000 limit for hidden/unseen mold.

For example, let’s say a tree falls on your home and water gets in. If the contractor comes in and starts tearing down the walls and there is mold behind walls, which could have been there a long time, that mold could be covered up to $10,000.

Check with your agent or insurance company to see what your specific deductibles, limits, and options are.

Stay mold free:

Every mold scenario has various factors and it is impossible to know if it will be covered without speaking to your insurance agent or carrier.

If you’re dealing with a mold problem, reach out to us so we can best advise you about if filing a claim is a wise option.

Unfortunately, if we’re being honest, in many mold cases you will simply be out of luck with it not being covered by insurance. 

However, that doesn’t mean there is nothing you can do to avoid the unsightly damage. Evaluate your home’s water vulnerabilities and take steps to prevent water damage, then hopefully you won’t find yourself questioning if that mold damage in your home is covered by insurance.