In a meeting this week with Democrats from the Florida House of Representatives, Florida Insurance Commissioner Kevin McCarty stated that, in his opinion, damages associated with allegedly toxic Chinese drywall are not covered damages under homeowner’s insurance policies. McCarty, who has generally been tough on insurance companies with respect to rate regulation, plainly stated that, from his perspective, the insurance industry is not responsible for the Chinese drywall problem. Rather, McCarty called for a federal funding source to deal with the problem.
McCarty specifically stated:
“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….Chinese drywall is not the result of a fire, a storm, a broken pipe or any of those things. It was a malfunction based upon a defective material that was installed in the building. And that historically has been excluded from a homeowner’s policy.”
McCarty also expressed the belief that manufacturers of Chinese drywall manufacturers, not insurance companies, are primarily liable for these losses.