Does home insurance cover mold in Ontario?

This is general information, not insurance advice. Policies differ, and only your insurer can confirm what yours covers.

The basic rule

Home insurance covers sudden and accidental events. It does not cover gradual deterioration or maintenance. Mold sits awkwardly between the two, because it is nearly always a consequence of something else.

So the question an adjuster asks is not “is there mold?” but “what caused the moisture, and is that cause covered?”

When mold is commonly covered

Where mold is a direct result of an insured loss that was reported and dealt with promptly. For example:

• A pipe bursts while you are at work, soaks a wall, and mold is found when the wall is opened a few days later
• Water used to put out a fire leads to mold in the following days
• A covered appliance failure wets a floor and the cavity beneath

In these cases, removing the mold is commonly treated as part of repairing the covered water damage.

When it usually is not

• High humidity and condensation, including bathroom, window and attic mold from poor ventilation
• Slow or repeated leaks over weeks or months
• Seepage of ground water through foundation walls and floors
• Poor maintenance: failed caulking, old roofing, blocked eavestroughs
• A known problem left unrepaired
• A loss that was not dried. If water damage was left, or reported late, and mold followed, the insurer may refuse the mold portion on the grounds that it could have been prevented.
• Mold present before you bought the home
• Water that needed an endorsement you do not have. Mold after a sewer backup or overland flood is only as covered as the backup or flood itself.

Mold exclusions and limits

Many policies contain specific wording about mold, fungi or spores. It takes several forms:

• An exclusion for mold altogether, with an exception where it results from an insured peril
• A sub-limit, a maximum amount for mold remediation that is much lower than the main limit
• Coverage available only by endorsement
• Conditions about how quickly the loss must be reported

Find the words “mould”, “fungi” and “spores” in your policy, including the exclusions section and any endorsements, and ask your broker to explain them.

Why prompt drying matters to the claim

Mold can begin within about 48 hours on wet materials. Policies require you to take reasonable steps to protect the property after a loss. Starting extraction and drying the same day does two things: it usually prevents mold altogether, and it shows that any mold found was a direct result of the event and not of delay.

Do not wait for an adjuster’s visit before drying. Photograph everything first, then start.

If you find mold after a leak

1. Stop the water and photograph the damage and the source.
2. Report the claim promptly.
3. Have the area assessed. Moisture readings and photographs of what is found inside the wall are useful evidence of how long it has been wet.
4. Keep the failed part, if there is one.
5. Ask the adjuster, in writing, how your policy treats mold and whether a limit applies.
6. Get a written scope for the remediation.

If you find mold with no obvious event

Long-standing mold in an attic, basement or bathroom is very unlikely to be covered. It is still worth fixing, for the sake of the house and the people in it. Before calling in a claim, you can ask your broker a general question about coverage. Be aware that insurers keep records of reported claims, including ones that are not paid.

Tenants and condo owners

Tenants. Your landlord is responsible for the building and for repairs. Your tenant policy covers your belongings and living expenses for insured perils, with the same sudden-versus-gradual distinction. Mold from damp over a winter is generally not an insured event for contents. See mold in a rental in Ontario.

Condo owners. The corporation insures the building and common elements. Your unit policy covers your improvements, contents and living expenses. A leak from another unit or a common pipe involves several insurers. See condo water leaks.

What a covered mold claim pays for

Subject to the policy and any limit:

• Finding and exposing the affected area
• Containment and removal of moldy materials
• Cleaning and drying the structure
• Rebuilding what was removed
• Cleaning or replacing damaged contents
• Additional living expenses if the home cannot be lived in

It generally does not pay to repair the failed pipe or appliance itself, and it does not pay for upgrades.

Testing and insurers

An insurer may or may not pay for mold testing. Where mold is visible, testing rarely changes the scope. On larger claims, an independent consultant may be engaged to define the work and confirm that it was completed.

If the claim is denied

Ask for the reason in writing and the policy wording relied on. Evidence that the water event was sudden, such as a plumber’s report and dated photographs, is what matters most. See water damage claim denied in Ontario.

Reducing the risk

• Fix leaks promptly and keep the receipts
• Ventilate bathrooms, kitchens and the attic properly
• Keep humidity between 30 and 50 percent
• Check under sinks and around appliances a few times a year
• Fit leak sensors
• Read the water and mold sections of your policy before you need them

More: mold removal and remediation.