A new water mitigation company in Melbourne buys a general liability policy for $1 million, the same coverage a painter or handyman might carry, and starts taking mold jobs. A year later a homeowner claims the company spread mold through her HVAC system. The general liability carrier denies the claim under its pollution exclusion. The owner learns that the policy he bought covers slips and broken windows, not the substance his business exists to remove.
For mold remediation and water mitigation contractors, the most important coverage decision is how general liability and contractors pollution liability work together. Here is what each covers and why a real program for this trade needs both.
What General Liability Covers
General liability covers bodily injury and property damage to others caused by a contractor’s operations: a customer who trips over a hose, a ceiling damaged while removing drywall, a car scratched by a trailer. It also covers personal and advertising injury and the cost of defending these claims. Every restoration contractor needs it, and Florida’s mold licensing law requires licensed assessors and remediators to carry at least $1 million of general liability that includes coverage for mold-related claims.
Where General Liability Stops
Most general liability policies contain a pollution exclusion, and many define pollutants broadly enough to include mold, fungi, bacteria and sewage. Some add a separate fungi or bacteria exclusion on top of it. For most contractors that exclusion rarely matters. For a remediation contractor it reaches the core of the business, because the claims this trade produces, spreading mold, failing to remove it, exposing occupants to it, are pollution claims. A general liability policy that excludes mold may also fail to satisfy the licensing requirement, so it’s worth reading the exclusions closely.
What Contractors Pollution Liability Covers
Contractors pollution liability, often called CPL, covers bodily injury, property damage and cleanup costs caused by pollution conditions arising from the contractor’s work, including mold, bacteria, sewage and other contaminants the contractor disturbs, spreads or fails to contain. It responds to the claims general liability excludes, and it is what most property managers, associations and insurance carrier vendor programs expect to see on a restoration contractor’s certificate. CPL can be written on an occurrence or claims-made basis, and claims-made policies require attention to the retroactive date and to coverage after the policy ends.
Where Professional Liability Fits
Many mold and water claims allege not an accident but an error: an inadequate remediation protocol, a building cleared too soon, a drying plan that missed hidden moisture. Those are professional liability claims, and mold assessors in particular are giving a professional opinion that general liability doesn’t cover. Many specialty carriers combine contractors pollution liability and professional liability on a single form for this class, which avoids gaps between two separate policies.
How the Pieces Fit Together
A well-built program for a Florida restoration contractor usually includes general liability with coverage for mold-related claims where licensing requires it, contractors pollution liability, professional liability, workers’ compensation, commercial auto, inland marine for drying equipment and contents in the contractor’s care, and an umbrella over general liability and auto. The limits should match what your clients and vendor programs require, and the forms should be compared side by side, because two quotes with the same limits can cover very different things. Our article on insurance requirements for this trade covers what clients ask for.
Worth Confirming
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Your general liability policy’s pollution and fungi exclusions
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Your general liability meets the licensing requirement for mold-related claims
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Contractors pollution liability is in place
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Professional liability covers remediation and assessment work
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You know whether CPL is occurrence or claims-made
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Limits match your client and vendor program requirements
Talk to Prestige Insurance Group
We write water mitigation, mold remediation and restoration contractors across Florida through specialty markets that offer contractors pollution and professional liability built for this work. Send us your current policies and a description of your services, and we’ll compare programs form to form, not just premium to premium.
Call the office nearest you. Se habla español.
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Miami: 305-969-8776
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Orlando: 407-993-2331
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Stuart: 772-247-3788
Related Resources
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What Water Mitigation and Mold Remediation Insurance Does Not Cover
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Insurance Requirements for Mold Remediation and Water Mitigation Contractors
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Biggest Water Mitigation and Mold Remediation Insurance Claims
General information only, not legal advice. Policy forms, exclusions and endorsements vary by carrier and by policy. Florida licensing requirements for mold assessment and remediation and the rules on assignment of benefits can change; confirm current requirements with the Department of Business and Professional Regulation and qualified counsel. Prestige Insurance Group, Florida agency license L057894.
