If you’re considering getting into the mold remediation industry, it can be lucrative if you have the right training and certifications. At the same time, for people thinking about starting a mold remediation business, and also for homeowners, there’s often confusion about who pays for these services. The short answer is that it depends. Homeowners insurance may pay, but only sometimes. 

The Basics of Mold Remediation

Mold remediation covers the entire process of removing all mold growth in a space. Remediation includes not just the removal of the mold but other necessary steps like demolition, containment, and cleaning. In Florida, there’s a legal distinction between being a mold assessor and a remediator, with an assessor being the professional who identifies the issue initially and the remediator being the person responsible for fixing the issues identified by an assessor. Florida law requires that you’re licensed as an assessor or remediator, but you can’t be both. As an assessor, you would return after completing the remediator’s work, ensuring the problem is truly fixed. The idea of the law is to avoid a possible conflict of interest if the same person is doing the work. A general contractor isn’t allowed in Florida to do mold remediation work if they aren’t trained and licensed, and the process requires specialized training and education.

The Costs of Mold Remediation

The average cost of mold remediation can vary from $500 to $6,000, making it a compelling industry if you’re licensed. The price can be tens of thousands of dollars if the situation is severe.   A homeowner will first hire a mold inspector if they suspect an issue. The inspector might then refer the homeowner to a removal contractor. If you’re a mold removal contractor, you then go in and start the cleanup process once the inspector has confirmed the presence of mold spores. The cleanup process is in-depth and includes removing materials that have mold or are water-damaged, cleaning and disinfecting walls, carpets, and personal items, and removing drywall and studs if there’s extensive damage. If you’re responsible for mold removal and cleanup, you’ll also vacuum the space with HEPA filtration. The remediation costs to remove mold just from crawl spaces can range from $500 to $4000. The costs to remove mold from crawl spaces, walls, attics, and ducts can average $2,000 to $6,000. It can be anywhere from $10,000 to upwards of $30,000 to repair mold damage that’s widespread structurally.

Does Homeowners Insurance Cover Mold?

As a contractor, it can be ideal for you when homeowners insurance covers the costs of mold removal, but whether or not this will be the case depends. Homeowners’ insurance usually will only pay for mold if a covered peril causes it. Covered perils are those events homeowners insurance covers, like water damage. If a homeowner, for example, had water damage because of a leak in their washing machine, their homeowners’ insurance will likely pay for mold removal. Homeowners’ insurance might also cover mold damage from a broken water heater, a frozen or burst pipe, or water damage from a fire. If you’re working with a client and they have homeowners insurance covering mold removal, you might want to use the assignment of benefits or AOB. The AOB gives you the authority to file a claim, make decisions about repairs, and collect payment from the insurer without the homeowners’ involvement. When done correctly, having a homeowner sign an AOB can make it easier for both you as the contractor and the homeowner to navigate the process of filing a claim. If the AOB is signed over to you, the insurer can pay you directly.

When Homeowners Insurance Doesn’t Cover Mold Removal

From your perspective, as a contractor in mold removal, it’s easier to deal with homeowners insurance directly. Still, you also have to be prepared for working with clients whose coverage isn’t going to pay for the work. Mold damage from a leaky faucet that went without repairs, doors or windows that were poorly sealed, or from a lack of ventilation in a moist place like a bathroom is unlikely to be covered by homeowners insurance. Homeowners’ insurance probably won’t pay for mold removal if the damage was because of sump pump failure or water backup damage, and most homeowners’ policies exclude flooding. The policy might not cover mold damage even when a homeowner has flood insurance. The National Flood Insurance Program, the biggest flood insurance provider in the country, will only cover mold damage if a homeowner can’t access their home after the flood. In these cases, if insurance doesn’t cover the costs, protect yourself as a contractor. Ensure you have a written agreement before you do any work for a homeowner. You want to make it clear to clients from the start that you are a skilled professional and charge as such. You’re also going to have relatively high overhead costs when you start a mold removal business which has to be considered in pricing. If you can set and manage expectations with clients from the beginning, it tends to make for a smoother process for everyone involved.

What About Flood Insurance?

Along with wondering whether or not homeowners insurance will cover mold damage, there’s also a question of the role flood insurance might play. A flood insurance policy can sometimes cover mold and mildew stemming from water damage as long as the source of damage is covered under the policy. The exception for mold under National Flood Insurance Program policies is when the damage could have been avoided or prevented. For example, homeowners are expected to take reasonable steps to limit the damage. If their home floods and a homeowner doesn’t clean up the water to try and prevent mold from spreading, their flood insurance claim might be denied. If you’re ready to start your mold assessment or remediation career, NETI can help. We have everything you need to be trained and also certified as a mold assessor or mold remediator.

Homeowners insurance doesn’t always exclude mold, but if it does, it would often be because negligence caused the damage. Negligence isn’t considered a named peril by homeowners insurance, so damage from mold would, in this case, not be covered.

Mold can come back after remediation, but a quality, professional company should be able to find the source of the moisture creating the problem. When that source of moisture is dealt with, it should prevent the mold from returning to that area.

There aren’t federal laws that determine a landlord’s responsibilities regarding mold, and Florida doesn’t have any laws at the state level that specifically discuss the duties or liability of landlords regarding mold.

The costs for mold remediation depend on factors like the location of the mold, the type, the scope of the problem, and labor costs.

Usually, mold and fungus are exclusions on a standard homeowners insurance policy, but if they occur because of a covered situation, they are covered. A roof leak may or may not fall into this category. If mold grows in a naturally damp room, then mold removal wouldn’t be covered unless you have a mold endorsement as part of your policy.