Filed Under:Claims, Catastrophe & Restoration

Fungi Surfaces Post-Disaster

Lingering Woes from Spring Tornadoes

We at FC&S viewed the news footage with horror after a deadly tornado swept through Joplin, Mo. on May 22. The devastation has already caused immediate deaths, injuries, and property damage. As the cleanup continues, new problems are arising.

Recently, news outlets have reported that a number of the people who were injured as a result of the tornado have been infected with a deadly fungal infection, mucormycosis, which occurs when a spore enters the body after a cut or other injury. According to the Centers for Disease Control (CDC), similar infections were found in some victims of the earthquake and the resultant tsunami in Japan. Although characterized as extremely unusual, the descriptions of events in the earlier cases are very similar to those identified in Mo. Emergency centers were able to identify victims’ infections as mucormycosis after their admittance and treatment for tissue injuries.

Although we may not be well-versed in the science of deadly fungal infections, the insurance industry has grappled with issues arising from mold for many years. Policy drafters have taken steps to control the amount of coverage available, but as new developments occur, there will surely be a renewed need to understand whether and how much insurance coverage is available to property owners who find mold growing in their buildings. Far more common than deadly infections will be the occurrence of mold in properties that could not immediately be made watertight after portions were blown away in the storm.

The endorsement also requires that the insured take reasonable steps to prevent the mold from occurring, although the endorsement wording recognizes that there may be a delay in protecting the property from mold growth after a widespread disaster such as a tornado. Essentially, this endorsement provides a predetermined insurance payment for mold cleanup and property repair, as well as a set limit of liability for third party damage or injury.

Does Coverage Exist?

There is little question that, at the least, mold is an irritant and contaminant, but is it a pollutant? Many courts—but not all—have held that naturally occurring irritants and contaminants such as fungi or mold are not meant to be excluded via the pollution exclusion. These jurisdictions hold that the pollution exclusion precludes coverage for damage arising from man-made pollution. The policy definition, however, is silent on this issue, leaving it up to the courts to interpret. The FC&S opinion over the years has been that these forms would owe defense costs at a minimum, and quite often damage payments, for injury or property damage arising from mold contamination.

So what happens if claims are filed in the case of the illness and death of individuals who suffered mucormycosis infections after the Joplin tornado? Suits against healthcare providers for failing to clean wounds thoroughly would undoubtedly trigger medical professional liability policies when the allegations involve faulty treatment.

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