Onity's Mold Prevention Solutions Shield Hoteliers From Insurance Woes
ATLANTA — The mold liability and insurance coverage issue is evolving. Black mold is a subject that many in the hospitality industry are talking about, but few know a great deal. Owners and operators who want to protect their assets from potential mold and mildew damage and associated liability claims are turning to Onity / Senercomm® and its SensorStat® energy management and black mold prevention systems to maintain room temperature and...
ATLANTA — The mold liability and insurance coverage issue is evolving. Black mold is a subject that many in the hospitality industry are talking about, but few know a great deal. Owners and operators who want to protect their assets from potential mold and mildew damage and associated liability claims are turning to Onity / Senercomm® and its SensorStat® energy management and black mold prevention systems to maintain room temperature and humidity outside the mold-spore growth range.
"While mold and mold spores cannot be entirely eliminated from indoor environments, their growth can certainly be halted through proactive, preprogrammed moisture control systems such as Onity's SensorStat® DDC," said Mark Keating, director of research and development for Onity/Senercomm®. "We are finding that by taking these proactive measures, hotels can save themselves tens of thousands of dollars each year in asset protection and liability claims."
Greg Plank, former president of Suburban Lodges of America and current president of Atlanta-based Worldwide Travel Marketing Inc., has been working with leading risk management and insurance groups to identify the criteria that would garner the best insurance programs and premiums in the industry. What he found was that the hotels that can best document how they prevent against or respond to mold issues are the ones receiving the best rates and coverage.
"Insurance experts and underwrites said that over the past several months, they've seen a significant softening in the property insurance market," Plank said. "Rates have come down, and underwriters say they are willing to talk about options that were once removed. The casualty side however, which includes environmental insurance claims rising from mold and microbial matter, is much different. In this area companies are still seeing increases across the board."
According to risk insurance experts, mold gets attention for mostly two reasons, Plank said: First, there is a concern from both underwriters and property owners/operators that mold and mildew damage will result in general liability or third-party claims from guests alleging that they got sick from exposure. Second, mold has become an issue in Workers' Compensation claims from employees.
"Underwriters say they are more concerned with Workers' Compensation claims from employees than liability claims from guests because recent studies have proven at best to be inconclusive that people get sick from mold on a short-term basis," Plank said. "The bigger issue comes from claims filed by employees that directly impact the property.
"Unfortunately, underwriters say most policies exclude coverage for mold," he said. "So, if there's a significant mold outbreak and the property needs to be closed and remediated, the hotel's property policy will not support the claim."
Insurance experts cite two significant costs involved from a property standpoint: clean-up costs and business interruption costs, Plank said.
"Lost income from a property having to be shut down can be significant," Plank said. "Even when the remediation project is complete and the property is cleaned and the mold and mildew is removed, there's no guarantee that guests will return. Not only does a hotel lose revenue when the facility is closed for remediation, but they run the risk of losing guests in the long-term and associated revenues from repeat business altogether."
The key to mold, experts say, whether it's from a humid climate or from an internal issue where perhaps a pipe breaks, is to have a remediation plan in place and control and clean up the source of water as quickly as possible. Buck Raines, director of facilities at the 357-room Four Seasons Resort & Club in Las Colinas Texas, agreed, saying "hotels that don't take action today will pay BIG later."
"If we had never installed Onity's SensorStat® DDC, our entire remediation project would have been for naught," Raines said. "Without built-in humidity controls, we would have been spending $50,000+ per year on remediation and related renovations. If we didn't change the humidity in the environment, in actuality we would have been just spending $50,000 per year on new food for mold growth."
Raines said Onity's SensorStat® DDC is a must for any new-build developer or current hotel owner/operator looking to protect its people and valuable assets, while minimizing vulnerability to increasingly common mold-related litigation.
Underwriters look specifically for response plans in place at the property, like the ones now in place at the Four Seasons, Plank said. Hotels with proactive programs or EMS systems in place that work to prevent mold and mildew growth are the ones with the best protection, and the best coverage options, he said.
"Hotels should be aware that the insurance carrier will want to inspect the property for the extent of mold and mildew, and will require a program or equipment in place to monitor and control mold," Plank said. "The best business practices in this area are to evaluate your situation, learn how to identify and remediate mold, prevent its growth before there is a problem."
According to Onity's Keating, scientists have defined the psychometric zone most favorable to the growth of mold and mildew as being above 72 degrees Fahrenheit and above 60 percent relative humidity. Onity's patented, five-star relative humidity sensor, an option of the SensorStat® DDC II, features a psychometric control algorithm, which is designed to maintain a room environment that is outside the mold and mildew growth zone.
"The setback feature of both the SensorStat® DDC I-F and the SensorStat® DDC II limits the amount of condensation that occurs in a guestroom when the door is opened and indoor temperatures clash dramatically with outdoor temperatures," Keating said. "That's the beauty of having an energy-management system. The additional benefit to the SensorStat® DDC II is the optional sensor that will detect when the relative humidity in the guestroom is above 60 percent, and using the existing room air conditioner to its maximum potential, will begin to remove moisture from the air, thus lowering the RH level to under 60 percent - the precise protection outside the mold and mildew growth zone."
Plank said underwriters today are absolutely focusing on those properties that are best run and best managed across the board.
"Underwriters are interested in companies that are focused on safety, security and the well being of guests," Plank said. "Those companies that reinvest in their properties with proactive solutions are the ones that benefit the most in the insurance marketplace. Commitment is the key."
For a free copy of Onity's "White Paper On Black Mold and Moisture Control," send your request to
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