Chinese drywall not covered by home owners insurance

During the housing boom in the mid-2000s U.S. drywall supplies were depleted and we began importing drywall from China to keep up with demand. It was later discovered that much of this Chinese drywall, which is made of gypsum plaster pressed between two thick sheets of paper, was defective and emitting poisonous odors, prompting many homeowners to leave their homes.

It is estimated that as much as 500 million pounds of Chinese drywall was imported between 2004 and 2008 and a little more than 1,800 complaints have been filed since October 2009, most of them coming from Florida, Louisiana and Virginia. Repair costs are currently estimated to be between $8-10 billion dollars.

Thousands of homeowners have filed lawsuits and many have filed claims with their insurance carriers, only to have them denied. It has become a point of contention between homeowners and insurance companies, with homeowners now facing tens of thousands of dollars in repair bills and insurance companies taking the stance that it is not a covered loss.

Florida Insurance Commissioner Kevin McCarty took a stance this week when he stated his opinion that insurance companies have no obligation to cover defective Chinese drywall. He feels that the insurance industry is not responsible for the drywall problem and so the financial responsibility lies with the manufacturers of the drywall.

What should a homeowner do if they are faced with this problem? Your first course of action is to contact the builder of the home to see how they are handling the situation. You should also file the complaint with the US Consumer Product Safety Commission. They can be contacted by phone at 800.638.2772.

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Sun Insurance Services, Inc. is a family-owned and operated insurance agency located in Orlando, Florida. We write with twenty of Florida's most prestigious insurance carriers and offer our clients a broad range of choice and customization for their insurance needs. Find us on the Web at www.suninsuranceservices.com.