Insurance Blog

An unexpected piece in the Chinese drywall puzzle has just been uncovered. Florida Insurance Commissioner Kevin McCarty has made clear that in his opinion insurers have no obligation to cover defective Chinese drywall because it is not a covered peril. The Sarasota Herald Tribune reports that at a meeting with state legislators earlier this week, McCarty told them the insurance industry is not responsible for the drywall problem and that ultimately the federal government would have to come up with a funding solution. The November 4 article by Lloyd Dunkelberger quotes McCarty saying: “This is not a covered claim. This is not a covered peril. We need to come up with a plan for a funding source to take care of this.” McCarty described the Chinese drywall issue as a “very, very significant problem,” and stated that the financial responsibility lies with the Chinese drywall manufacturers rather than insurance companies. […]

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A Chinese drywall symposium hosted by the University of Florida College of Engineering will be held in Tampa, Florida on Thursday and Friday (November 5 and 6) of this week. The event will bring together researchers from the primary state and federal agencies to present their findings on technical topics such as materials analysis, emissions testing, exposure assessment and toxicology, remediation and repair. Florida Senator Bill Nelson is scheduled to give the keynote speech on Friday. A preliminary report from the Consumer Product Safety Commission (CPSC) late last week found that while Chinese drywall emits higher levels of sulfur gases and strontium than drywall manufactured in the United States, there is no evidence that the emissions are linked to health problems and metal corrosion. Indoor air testing of 10 homes in Florida and Louisiana was conducted for the study and an analysis of 50 additional homes is underway with the […]

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There have been a number of media stories on the imported drywall (otherwise known as Chinese drywall) issue in recent days. Here’s a quick synopsis. A story in today’s New York Times by Leslie Wayne reports that hundreds of drywall-related lawsuits are piling up in state and federal courts and a consolidated class action is moving forward in Federal District Court in Louisiana that will begin hearing cases in January. Meanwhile, an article in today’s Miami Herald by Beatrice Garcia and Nirvi Shah underscores the point that homeowners are unlikely to find coverage for Chinese drywall issues under homeowners insurance policies because of exclusions for pollution, contamination damage or problems stemming from construction defect. A September 28 article in the Baton Rouge Advocate by Cain Burdeau reported on how Chinese drywall manufacturers may ignore drywall-related lawsuits pending in U.S. courts. A recent report by Swiss Re provides an excellent overview […]

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