Mold & Apartment Owners: Are you covered?

Mold & Apartment Owners: Are you covered?

Mold has the potential for being an expensive and time-consuming discovery. It causes health problems and puts property owners at risk of losing tenants. The property could be considered uninhabitable and tenants have the option to break their lease, or worse, sue.

What causes mold?

Moisture causes mold. Oftentimes, mold can stem from a leaky pipe, moisture seeping in from the outdoors through leaking windows or doors, and poor ventilation.

Contractor Magazine says that signs that mold might be present are standing water, water condensation, water staining, strange colors, growth on building materials, increased humidity, water damage, confined spaces, health issues and a musty smell.

A musty smell is a good sign there is mold somewhere in the home. Call a mold tester if you smell must to find where the mold growth is hidden.

How do you remediate mold?

Probuilder recommends this seven-step process to remediate mold.

  1. Find the source of the moisture and fix it.
  2. Isolate the problem. Cover the doors and windows around the contaminated area so it cannot grow to become a bigger problem. Use polyethylene sheets with duct tape to seal the space.
  3. Mist the contaminated area to remove dust from the air.
  4. Remove contaminated materials.
  5. Clean with a wire brush and appropriate detergent for mold.
  6. Dry the area that has been cleaned.
  7. Replace all materials that needed to be removed.


What are your responsibilities as a property owner? says that mold is the cause of millions of dollars in lawsuits against landlords. However, currently, there are no federal laws regarding mold responsibility for landlords.

Some states are making local laws regarding mold. But, even without laws, landlords are still often responsible for mold issues because of their requirement for providing a habitable home.  The landlord is responsible for fixing issues that may cause the mold like leaks, plumbing issues, or flooding.

A tenant can sue a landlord for failing to fix any of these issues resulting in mold growth. However, if the mold is caused by an action the tenant took, like not keeping the property clean, they are responsible.  Landlords and tenants should work together to prevent mold. Property owners need to maintain their property and tenants need to inform landlords of issues immediately so they can be remediated.

Does homeowner’s insurance cover mold?

In most cases, mold is not covered by a standard homeowners insurance policy and a typical business owners policy for an apartment owner or property manager.

The mold itself is usually not covered, but if an accident, such as a burst pipe, caused the mold, then remediation may be covered.   There are mold riders that can be purchased and added on to your policy in some states. They can be expensive though. They could add $500 to $1,500 to your homeowner’s policy each year.  The cost for a stand alone mold policy for a landlord or apartment owner typically starts at $5,000 to $10,000 annually.

In Conclusion

The Centers for Disease Control says that mold can cause respiratory issues, chronic nasal stuffiness, coughing, eye irritation, and skin irritation. Address mold immediately upon finding it. It spreads quickly and gets worse over time.

The best solution is for property owners to have open communication with their tenants and maintain their properties.

Keep the property well-maintained and encourage tenants to inform you of issues immediately so they can be resolved before mold growth happens. And, always understand what your insurance policy covers. If your property is in a high-risk environment for mold growth, look for a mold rider for your homeowner’s insurance.  Keep in mind, most apartment and landlord policies exclude mold coverage and require you to obtain a separate mold insurance policy.


GS Insurance Solutions, Inc is a full-service insurance and risk management brokerage specializing in the apartment and property management industry.  GS Insurance Solutions is the exclusive endorsed broker for the Apartment Owners Association of California.  For more information on the full area of products and services we offer tailored to your specific needs, please call our team at (650) 282-3014 or email us at

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