Texas Supreme Court Holds that Mold Is Not Ensuing Loss

AUSTIN, Texas - Answering a question certified by the U.S. Court of Appeals for the 5th Circuit, the Texas Supreme Court ruled Aug. 31 that an ensuing loss provision in a standard Texas homeowners policy cannot be read to provide coverage for mold damage where the policy specifically excludes mold. Fiess v. State Farm Lloyds, No. 04-1104 (Texas Sup. Ct.).

The court's long-awaited ruling came in a 7-2 majority opinion, with the court holding that '[a]mbiguities in the plain language must be settled in favor of consumers, but they must appear in the policy itself - we cannot create ambiguities …