5th Circuit Finds Mold Claims Arising From a Covered Peril are Excluded

NEW ORLEANS - Mold claims are excluded under a standard-form Texas homeowner's policy even though leaky plumbing, which is a covered peril, caused the damage, the 5th Circuit U.S. Court of Appeals has affirmed. Carrizales v. State Farm Lloyds, No. 06-40286 (5th Cir.).

The panel ruled on Feb. 22 that the policy's exclusion repeal provision, which lists mold as an excluded peril, is not ambiguous when read in conjunction with the covered perils provision.

However, the panel remanded the policyholders' breach of contract claims to the U.S. District Court for the Southern District of Texas for a new trial, ruling …