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Mold And Water Intrusion Prevention
For Building Owners And Property Managers
This document highlights many of the
significant program elements that prospective or existing
XL Insurance clients should have in place to address
water intrusion and mold prevention. Controls will differ
from company to company; however, it is generally agreed
that a Program Coordinator should be designated with
overall responsibility for implementation of a water
intrusion and mold prevention program. A written Operations
and Maintenance (O&M) Plan that ties together various
prevention, risk transfer and response protocols has
become the standard of care for building owners and
property managers. Training of key personnel that focuses
on the specific responsibilities and actions outlined
in the O&M Plan is also regarded as a best management
practice.
A comprehensive water intrusion and mold prevention
program should build upon existing company practices
and protocols. Development of new program elements may
require an additional investment of resources; however,
this pales in comparison to the time and expense associated
with potential property damage and litigation. This
outline concludes with resources that can be used by
XL Insurance clients to develop a water intrusion and
mold prevention program.
Organizational Structure and Communication –
A Program Coordinator, who is responsible for the overall
implementation and effectiveness of the water intrusion
and mold prevention program must be designated. Other
key in-house staff (i.e., building maintenance staff,
engineers, property managers, etc.) must be identified
and their responsibilities clearly delineated. An internal
hierarchy of communication should be established. Staff
responsible for contacting outside parties should be
identified and protocols for engaging subcontractors,
insurance companies, and tenants, must be established.
Company expectations for prevention and response to
water intrusion and mold events should be created and
reviewed, with third party property managers, consultants
and subcontractors.
Preventative Maintenance (PM) – A proactive PM
program designed to prevent water intrusion and maintain
the integrity of the building structure (roof, windows,
doors, and other openings) and external drainage features
is critical. Maintenance protocols should be established
for heating, ventilation, and air conditioning (HVAC)
systems, plumbing systems, and general maintenance/housekeeping
of building interior and exteriors. It is recommended
that indoor spaces should be maintained at a constant
temperature above 65oF with relative humidity between
45% to 55%. A written O&M Plan incorporating industry
best management practices should be in place to address
key responsibilities, maintenance requirements, management
systems and documentation.
Inspections and Prevention Protocols – Documented
inspections should be conducted on a regular basis (quarterly
at a minimum) so that the building is reviewed during
various seasonal and operational conditions. It is also
prudent to have an inspection protocol following severe
weather events (thunderstorms, windstorms, ice storms,
etc.) or power outages. The building interior and exterior
should be inspected for signs of water intrusion and
mold growth. Unusual odors in indoor spaces may also
be a sign of developing problems. Crawl spaces, basements,
and attics may be difficult to access, but are common
areas for water intrusion and mold. HVAC and plumbing
systems should be visually inspected for obvious signs
of damage, leaks or other problems.
Documentation and Management Systems - A Water Intrusion
Event Form and a Mold Incident Report Form should be
created to document tenant complaints, building impacts
and corrective actions associated with each individual
event. Some firms may combine these reports; but regardless
of the format, reports should clearly outline decision
making and actions associated with water intrusion or
mold events. Documentation should be based on known
facts, and care should be taken not to incorporate unqualified
or uninformed opinions that could be discoverable during
litigation. Completion of follow-up actions and communication
with effected parties will ultimately be the responsibility
of the Program Coordinator. Photographs are highly recommended
to supplement incident reports. Company response protocols
should reinforce responsibilities for communication
and documentation.
Mold Complaints and Claims - Notification must be made
to insurance companies before undertaking work and accruing
expenses associated with mold claims; however, emergency
response actions necessary to prevent further property
damage or bodily injury should be taken immediately.
Insurance company claim reporting requirements should
be clearly established in the response protocols. Generally,
if a tenant complaint or claim has not been received,
a building owner should take appropriate actions to
correct water intrusion problems or remediate mold.
Response Protocols – A quick response within
24 to 48 hours of water intrusion events is key to minimizing
damage. A qualified contractor network should be established
and available to correct the source of water immediately.
Under the advice of a qualified professional, water
damaged materials may be removed and replaced, with
residual water extracted from the area using pumps,
dehumidifiers, and fans. Mold abatement can typically
be performed by trained in-house staff for areas involving
less than 10 square feet, but professional vendors should
be utilized when this is exceeded. Pre-qualified mold
remediation firms should be utilized. Generally, mold
testing (air or wipe samples) should not be conducted
until after abatement is completed; however, professional
firms employing qualified industrial hygienists should
be relied on to prepare an abatement and testing plan.
Risk Transfer Programs – Building owners should
work with legal counsel to incorporate standard language
into lease agreements that address water intrusion and
mold events. Lease agreements should outline tenant
responsibilities and liability for maintaining temperature
and humidity controls, performing visual inspections
of the leased space, and reporting any problems throughout
the lease term (including extended vacancies). Building
owners should establish written contracts with all third
party property managers, building subcontractors, and
mold remediation vendors, who address water intrusion
and mold issues. Contract language should be monitored
to avoid accepting liability for third party acts or
omissions leading to mold problems. Protocols for qualifying
third party vendors and subcontractors should be established
to ensure appropriate qualifications and experience.
Subcontractors with professional liability policies
including mold coverage are preferable.
Construction/Renovation – Construction projects
present a unique set of challenges, which should be
given additional scrutiny. Pre-qualification of subcontractors
should include a review of water intrusion and mold
prevention programs and insurance coverages associated
with design and construction phases. Building materials
and spaces must be kept dry during construction and
renovation activities. Inspection of building materials
and routine inspection of the premises should be conducted
throughout the life of a construction/renovation project.
HVAC systems should be routinely operated to control
temperature and humidity.
Tenant Communications – In addition to lease
language, supplemental educational materials are recommended
for distribution to tenants at the time of signing the
lease. Such materials should clearly delineate responsibilities
for maintaining the tenant’s premises and immediately
notifying building management of water or mold problems.
Complaint and response protocols should include a standardized
Tenant Notification Letter that acknowledges the water
intrusion or mold event was investigated and appropriate
corrective actions were taken. This notification should
also include any additional tenant responsibilities
and reinforce reporting protocols if problems persist.
Promises should not be made regarding testing/sampling
or the level of cleaning/abatement. Verbal follow-up
is strongly recommended to ensure tenants are confident
and satisfied with the building owner’s response.
Ultimate responsibility for the satisfactory closure
of water intrusion and mold events lies with the Program
Coordinator.
Training – Internal staff training on water intrusion
prevention and mold awareness should be completed to
assure competent and qualified decisions. Training should
be tailored to address the specific responsibilities,
actions, and management protocols outlined in the O&M
Plan. It is recommended that training for key management
personnel be conducted annually, with a focus on lessons
learned and what is or is not working. Training programs
may also be expanded to third party property managers
and other subcontractors.
Program Review and Continual Improvement - Annually,
the Program Coordinator should update the O&M Plan
and conduct a critical review of the implementation
and adequacy of controls in-place. This internal “audit”
should include a review of documentation and the knowledge/awareness
of the program demonstrated by key personnel. Feedback
from annual training sessions should be used to improve
water intrusion and mold prevention programs.
Resources
New York City Department of Health & Mental Hygiene
– Guidelines on Assessment and Remediation of
Fungi in Indoor Environments
www.ci.nyc.ny.us/html/doh/html/epi/moldrpt1.html
United States Environmental Protection Agency - Indoor
Air Quality - Mold Home Page and Mold Resources
www.epa.gov/iaq/molds/moldresources.html
United States Environmental Protection Agency –
Indoor Air Quality in Large Buildings – Indoor
Air Quality: A Guide for Building Owners and Facility
Managers www.epa.gov/iaq/largebldgs/baqtoc.html
United States Environmental Protection Agency –
Indoor Air Quality in Large Buildings – Indoor
Air Quality Building Education and Assessment Model
(I-BEAM) www.epa.gov/iaq/largebldgs/ibeam_page.htm
United States Environmental Protection Agency, Mold
Remediation in Schools and Commercial Buildings EPA
402-K-01-001
www.epa.gov/iaq/largebldgs/i-beam_html/ibeami.htm
Occupational Safety and Health Administration, A Brief
Guide to Mold in the Workplace www.osha.gov/dts/shib/shib101003.html
XL Environmental • Risk Control Division •
520 Eagleview Boulevard, PO Box 636, Exton, PA 19341
• Phone: 800-327-1414 • Fax: 610-458-7285
• www.xlinsurance.com/environmental
© 2005 XL Specialty Insurance Company. All rights
reserved.
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