A guest checked out early claiming “respiratory distress” due to black mold in the bathroom grout. They are demanding $15,000 for medical bills and a refund. I called my insurance, and they pointed to the “Fungi and Bacteria Exclusion,” limiting my payout to $5,000 for cleanup only, with zero coverage for the guest’s illness liability.
Key Takeaways
- The “Fungi” Cap: Most policies cap mold damage at $5,000 or $10,000 total. This barely covers remediation, let alone a liability lawsuit.
- Liability Exclusion: Many policies exclude liability (bodily injury) caused by mold entirely. If the guest sues for sickness, you have no defense lawyer.
- AirCover’s “Habitability”: Airbnb will treat this as a “Safety Issue.” They will suspend your listing immediately and require a professional mold test to reinstate it.
- Slow Leaks: Mold usually comes from a slow leak. Insurance covers “sudden” damage. Slow leaks are often denied as “negligence/maintenance.”
The “Why” (The Trap)
The trap is the “Pollution and Fungi Exclusion.”
Insurers classify mold as a pollutant. Standard policies are terrified of “toxic mold” lawsuits (like the ones in the early 2000s). Therefore, they strictly limit or exclude coverage for any bodily injury arising from the inhalation of fungi, mold, or spores. In 2026, AI-driven medical claims make it easy for guests to link asthma attacks to your property.
The Investigation: I Called Them
- Farmers (Landlord): Confirmed a strict $5,000 limit for property damage. “We do not cover liability for mold sickness,” the agent said. “That is a pollution event.”
- Proper Insurance: They offer a “Squatters & Mold” enhancement. It increases the limit (often to $15k or more) and, critically, can include liability defense for mold-related sickness if you select the right package.
- Airbnb AirCover: They will refund the guest from your future payouts. They generally do not accept liability for long-term health claims like mold exposure, pushing that back to the host.
Comparison Table: Mold Coverage
| Feature | Proper Insurance | Standard Landlord | Airbnb AirCover |
| Cleanup Limit | Higher ($15k+) | Low ($5k cap) | Cleaning Fees only |
| Liability (Sickness) | YES (If endorsed) | NO (Excluded) | NO (Typically) |
| Loss of Income | YES | NO | NO |
| Testing Costs | YES | NO | NO |
[IMAGE: Photo of a bathroom ceiling with small black spots, contrasted with a denial letter citing ‘Fungi/Bacteria Exclusion’]
Step-by-Step Action Plan
- Buy a Dehumidifier: Keep humidity below 50%. Smart sensors can alert you if a guest takes 2-hour showers and steams up the place.
- Inspect Grout Monthly: Re-caulk at the first sign of discoloration. It’s a maintenance issue, so you can’t claim it, but you can prevent the lawsuit.
- Test Immediately: If a guest complains, hire a mold inspector ($400) that day. If the test is negative, you save your listing. If positive, you catch it early.
- Check Your Cap: Look at your Declarations Page for “Fungi/Mold Limit.” If it’s $0 or $2,500, ask to raise it to at least $10,000.
FAQ
Can I just bleach it?
For cleaning, yes. But for a liability defense, you need a professional to certify it’s gone, or the next guest will complain too.
Does AirCover pay for the mold test?
No. You pay for the test to prove to Airbnb you are innocent (or fixed).
What if the guest fakes it?
Demand a medical report and a professional mold test. Without proof of mold in the unit, their claim falls apart.