Property insurance coverage for mold, fungi, dry rot, or bacteria is often provided only if it is caused by a covered peril.
If mold, fungi, dry rot, or bacteria is due to a covered peril, a policy may cover the cost to remove it; tear out or replace part of a property in order to reach the damaged area; and the cost to test the air or property to determine if it is still impacted by mold, fungi dry rot or bacteria.
Mold can occur due to water events, such as a leaky pipe. But removing it is not always covered in a commercial property policy.
Many commercial property policies include a fungus exclusion. This means that loss or damage due to the growth or spreading of a fungus, wet or dry rot or bacteria will not be covered. However, limited coverage may be available if the loss is due to fire or lightning or other specified cause, such as vandalism or water damage from fire extinguishing equipment.