by Brendan Reid

Mold isn’t just an issue for the HVAC industry. In the last few years, insurance companies have been hit with an ever-growing number of mold and water damage claims by homeowners. The insurance company then assigns an adjuster to determine if it should pay out on the claim.

In many cases, the cause is clearly covered by the policy, such as a plumbing leak, A/C condensate drain pan overflow, or other accidental discharge of water. Depending on the policy and circumstances, certain roof leaks and floods may also be covered.

However, in other cases, a growing number of insurance companies and adjusters are determining that many chronic moisture and mold problems are due instead to moisture condensation on cold surfaces, and/or excessive indoor humidity. This is turning out to be very common in hot, humid states such as Texas and Louisiana, and cold snowy states such as Minnesota and Wisconsin.

Moisture damage and mold growth caused by condensation and high indoor humidity are generally NOT covered by standard insurance policies. When this is the case, the insurance company can legitimately and confidently deny the claim, saving it tens or even hundreds of thousands of dollars.

At Comfort Institute, we have developed protocols and have been training and supporting our member HVAC companies to provide insurance companies with “Moisture and Humidity Targeted HVAC System and Building Envelope Inspections.”

The service identifies how or whether the home’s HVAC systems and building thermal envelope contribute (or contributed) to the moisture/mold problem.

Just as plumbing contractors are routinely hired to test for water leaks, and roofers are hired to inspect for roof leaks, adjusters for most of the major insurance companies often retain qualified HVAC contractors to perform this whole house HVAC/humidity inspection service.

During the inspection, it’s not uncommon to find that the home has more than one contributing problem. Our inspection process helps the adjuster determine and decide what is covered, what isn’t covered, and what may still be in a gray area. Knowledge is the key to arriving at a fair and appropriate resolution to these claims.

Inspection and Reporting

This onsite inspection typically includes a battery of tests and inspections:

  • A thorough visual inspection of the HVAC systems, building envelope, and visible mold or moisture staining
  • Digital photographs of all important findings
  • Homeowner interview
  • Temperature and humidity readings of indoor air and supply air
  • Infiltrometer blower door testing of house air infiltration rates
  • Testing for duct leakage to outdoors, preferably by measuring leakage with a flow hood while creating a driving test pressure with the blower door
  • Building pressure testing to determine the effects of the duct leakage, door closure, and exhaust fans
  • Flow hood measurements of supplies, returns, and exhaust fans
  • Static pressure measurements
  • Block load heating and cooling calculations.

Some contractors also test refrigerant charge. Longer term monitoring of indoor relative humidity is helpful, but not usually included in the standard inspection.

Actual sampling for mold is rarely a part of the standard inspection. Most member companies find it is prudent to limit the inspection to finding the causes of the moisture that led to mold growth, and leave the mold testing to the insurance company’s other specialists.

The inspection is usually performed by an experienced Comfort Consultant who has undergone advanced training. Anyone performing these inspections must have a thorough grasp of psychrometrics and building science.

The onsite inspection typically takes three to four hours for a single-system house. Report preparation at the office typically takes another one to two hours.

Once the inspection is complete, the consultant draws and presents conclusions regarding why the moisture damage and attendant mold growth has occurred. He or she then makes recommendations on HVAC repairs or other measures that would reduce water damage, surface condensation and/or excessive indoor humidity.

Explanatory fact sheets regarding moisture and humidity control, as well as other resource material, are attached to the report as appropriate.

The result is a very comprehensive report that helps the adjuster make an accurate determination of the insurance company’s liability. The report is normally shared with the homeowners, as it helps them understand the cause(s) of the mold, the reasons behind the insurance company’s decision on their claim, and what they need to do to resolve the problem.

Also during the examination, inspectors routinely identify non-moisture HVAC-related issues needing to be resolved. Here, they offer suggestions on how to correct observed HVAC code violations, installation errors, or maintenance deficiencies. These recommendations are quite valuable, as they can increase system safety and dependability, and reduce energy waste, discomfort, dust infiltration, and other possible indoor air quality problems.

Testing and Repair Income

For our Comfort Institute member HVAC companies, the insurance company inspection service is profitable in its own right. For example, one member in Texas performed more than 800 inspections at between $600 and $800 each during the first six months of 2002.

Moreover, many inspections lead to sales of repairs and new HVAC equipment after the claims process is completed. Even if the insurance company denies the claim, or only approves a partial claim, the fundamental causes of the homeowners’ moisture problem don’t go away.

The HVAC company that was able to finally figure out the cause of the moisture and mold problem usually becomes the preferred contractor to fix it. This is especially true if the HVAC company the customer had been using was found to be part of the problem.

HVAC Equipment as the Culprit

Mold problems are moisture problems. No moisture, no mold. There are many moisture sources that an HVAC inspector isn’t expected to diagnose, such as plumbing and roof leaks, and exterior wall flashing problems. However, an inspector should be able to recognize and diagnose those directly related to the A/C system.

The following are some common A/C causes of water leakage, surface condensation, and chronic high summertime indoor humidity that we regularly encounter when diagnosing problem houses. If your company makes any of these mistakes on jobs it installs, liability is inevitable:

  • Oversized A/C equipment that short cycles, reducing moisture removal (caused by many factors)
  • Higher SEER A/C equipment with lower moisture removal capability (some do, some don’t)
  • Improper A/C refrigerant charge
  • Insufficient A/C maintenance, especially leading to condensate drain pan overflow
  • Lack of emergency drain pans, or pans that aren’t large enough or sloped properly
  • Condensation on ducts and air handlers in unconditioned spaces due to missing or inadequate insulation, or low airflow
  • Condensation on condensate drain lines and refrigerant lines due to missing rubber insulation (often chewed off by rodents)
  • High airflow (e.g,. more than 450 cfm per ton in a hot humid climate), caused by mismatched equipment that defaults to high speed for cooling, and no commissioning. This leads to inadequate dehumidification, and sometimes condensate blowing off the indoor coil.
  • Constant summertime air circulation, which causes re-evaporation of moisture from the coil and drain pan, and accelerates humid air infiltration due to duct leakage and pressure imbalances. This is a common problem with new EC motor systems.
  • Lack of dedicated dehumidification equipment that can control humidity independent of sensible load.

Infiltration and Duct Leakage

There’s a lot more to summertime mold and moisture control than just the A/C equipment. The key to the success of the inspection approach is that it acknowledges that the house is an interactive system.

During the summer, a leaky house is often a humid one. For most of the eastern U.S., outside air contains large amounts of water vapor. The infiltration of this air in the spring, summer, and fall can bring in significant amounts of water vapor from outside (the latent load).

Here are some common causes of excessive air exchange that can lead to chronically high indoor humidity levels:

  • Excessive summertime humid air infiltration resulting from a leaky house and leaky duct system
  • Negative air pressures and high infiltration rates caused by powered attic ventilators and interior door closure
  • Infiltration at the ceiling supply duct boot to sheet rock joint
  • Moisture migration from the soil and crawl spaces.

The air in bathrooms and kitchens is sometimes more humid than outside and has to be exhausted. For this reason, inadequate spot ventilation is a common contributor to mold growth, especially in bathrooms.

Unexpected Condensation

Occasionally, the humid outdoor air doesn’t even have to enter the actual living space to cause problems. We regularly inspect houses where summer condensation occurs inside interior building cavities such as walls or floors that communicate with attics or crawl spaces.

Condensation first occurs on concealed, cold, and uninsulated (or poorly insulated) ducts, condensate drains, and refrigerant lines. Although they shouldn’t sweat because they are “inside” the house, they still do. Negative pressures draw the humid air in. Houses over crawlspaces with powered attic ventilators in the attic are the worst offenders.

Condensation also can occur in walls and floors that aren’t nearly as cold as ducts or condensate drains. If the house is cooled to 68F, and the dewpoint of the outdoor air is 68F or higher (very common in the Southeast in the summer), the entire house structure can become an evaporator coil.

If the walls are covered with vinyl wallpaper, or a floor over a crawlspace has vinyl flooring, mold growth is almost inevitable. Condensation on cold concrete basement walls and floors is a similar common contributor to mold growth.

Excessively High T-stat Settings

We are finding that the temperatures at which the occupants keep a home can greatly affect common moisture condensation situations. The colder the house, and the colder the supply air temperature, the greater the chances are of unintentional condensation. Many homeowners overcool their houses if their A/C system can’t remove enough humidity.

Winter Humidity Issues

Most of the insurance inspection work so far has been in the humid South. However, because mold and moisture problems are present everywhere, we believe the opportunity to perform this service exists everywhere, including cold climates.

In the winter, a leaky house tends to be a dry house. However, if a house is tight, or if there is a damp foundation, the indoor-generated moisture can become trapped, leading to high indoor winter humidity levels, sweating windows and mold growing in corners and closets. New home builders have real liabilities if they build a tight house with poor mechanical ventilation.

HVAC equipment can contribute to excessive humidity during the winter. One common case is when new power-vented, sealed combustion furnaces or water heaters replace older, naturally aspirated equipment. They send less air up the chimney, thereby creating less dry air infiltration.

In addition, combustion gases contain a lot of water vapor, and unvented gas fireplaces, blocked vents or chronic backdrafting can lead to dangerously high indoor humidity. Finally, humidifiers can over-humidify a house if not properly controlled.

While winter air infiltration tends to dry out a house, the humid, warm, indoor air leaving the house can cause concealed moisture problems by carrying moisture into wall, roof, and attic cavities.

Many winter and spring “roof leaks” in cold climates are actually the melting of indoor air moisture that has leaked into the attic, condensed, and built up as ice. Roof leaks resulting from “ice dams” (caused by snow melting over warm attics and then re-freezing at the eaves), are a similar problem. Although the roof is fine, it can’t withstand excessive ice build up.

HVAC Contractor Liability

Of all the air conditioner, infiltration, humidity, and temperature control problems discussed here, only the damage caused by condensate drain pan overflow is typically covered by an insurance policy.

However, in the past, insurance adjusters have almost automatically paid out on claims due to other non-covered causes because they didn’t understand the building science. They also didn’t have a third party authority who could investigate it in the field and explain it to all involved.

This is changing. Adjusters are becoming more knowledgeable, inspection procedures are becoming more available, and policies are being changed to limit mold coverage.

In some cases, if homeowners can’t get satisfaction from their insurance policy, and the inspection report uncovered blatantly bad work or lack of engineering by their original HVAC contractor, their next call is to their attorney. On the other hand, the insurance company may pay out on a claim, and then, in turn, go after the HVAC company’s liability insurance policy.

Whether or not you decide to become involved with performing insurance inspections, as HVAC contractors, it’s essential to understand the causes of moisture and humidity control problems in order to serve your customers better, and reduce the liabilities from the work you perform every day. n

Brendan Reid is the president of Comfort Institute, which provides HVAC contractors with instruments and training on IAQ, humidity control, whole house, and air distribution diagnostics and repair. He can be reached at 800/742-1207 or breid@comfort-institute.org