Marketing Reducing the threat of fire and mold Building material treatment acts as both fire retardant and mold preventive By Phil Zinkewicz The first little pig decided to build his house of straw. The second, only a little wiser, opted for wood. But if it had not been for the third little pig, pigs number one and two would have been roast pork sandwiches for the big bad wolf. Home building is booming in America. According to a recent article in Consumer Reports (CR), in 2004 consumers bought one million homes in the United States, a near record. Average sales price was $250,000, says CR; but a CR investigation has found that, increasingly, buyers are discovering that their new dream homes have serious defects and that they have little regulatory oversight to protect them for what is often the purchase of a lifetime. For example, according to CR, in Oregon a family built a semi-custom home on a lot they owned only to discover mold—that horrible word—in the walls four months later. That’s only one case out of many. CR says that construction defects lawsuits are on the rise nationally, but the toxic mold situation makes things much worse. Wouldn’t it be wonderful if building contractors could construct buildings where the risks of mold and/or fire are minimal? It certainly would be beneficial for the Gulf Coast area, where homes will have to be rebuilt from scratch. Shortly after Hurricane Katrina, the National Association of Home Builders (NAHB), testifying before Congress, said that the American Red Cross has estimated that 275,000 homes were destroyed in Louisiana, Mississippi, and Alabama as the result of the hurricane. That is nearly 10 times as many as in any previous natural disaster in U.S. history, said the NAHB. According to Arthur Sterbcow, president of New Orleans-based Latter & Blum Realtors, Florida lost 20,000 homes in the wake of Hurricane Andrew and San Francisco lost 27,000 homes in the Northridge Earthquake. Referring to the number of homes lost in the Gulf Coast because of Katrina, Sterbcow said; “That’s a number so large that it’s almost impossible to get a sense of scale.” So, the stage is set for a surge in home building construction, but will there be enough contractors to take on the Herculean task? The fear of being hit with mold lawsuits later on could be a discouraging factor. Mold exclusions on homeowners insurance policies have gotten a lot of attention in the last few years, but less well known are mold exclusions on the policies of home builders. Without some protection from mold-related lawsuits, home builders are in a precarious position. Now comes a company called No-Burn®, based in Wadsworth, Ohio, that says it can provide products for home builders to safeguard at the time of construction against fire and mold, and it is offering an insurance-backed warranty, backed by an off-shore captive, to fill the gap caused by mold exclusions in home builders’ insurance contracts. Ken Rusk, vice president of No-Burn, explains: “The seven-year No-Burn warranty covers the home builder for all areas treated with No-Burn MIH, a non-toxic compound designed to deny fuel for fires as well as food for mold. The warranty, covering the home builder for up to $50,000 in mold remediation-related costs, is the only insurance-backed risk mitigation tool available. This warranty gives the builder peace of mind that evaporated when his or her traditional mold insurance disappeared. “Just as important,” he continues, “the warranty improves the builder’s relationship with customers, reassuring home owners that their new house is mold-resistant and that they won’t be on the hook for cleanup if the worst happens. In that sense, the warranty separates the best builders from the good during the bidding process for new construction projects.” Good-bye mold The No-Burn encapsulation process is used on building materials to protect them from fire and resist mold growth. Unlike fire, mold thrives in the moist cavities of a structure. However, Rusk says, mold and fire need the same basic food source—the wood framing and paper-faced drywall installed in most homes. He says that all the builder has to do is spray on the No-Burn product, first when the wood framing is constructed and then again when the drywall is in place. He says the No-Burn products are not only non-toxic but also non-carcinogenic. In addition, they have been successfully tested by the NFPA, UL, ASTM, and other safety organizations. “Mold liability has sent the industry into such a panic, some builders are actually setting money aside specifically for potential future mold claim payments,” says Rusk. “Builders should not have to create a costly ‘mold reserve’ to guard against claims and the No-Burn warranty eliminates the need for these kinds of extreme measures.” In addition to single-family home builders, builders of multi-family apartments and condominiums with eight units or less can be covered by the warranty. Says Rusk: “When you build a condo and mold breaks out, you have all the same problems times eight. Builders are also turning to No-Burn’s mold and fire protection system because it is the first warranty to offer formal certification, assuring protection against the costs of mold remediation. In addition, home builders are attracted to the No-Burn system because it creates revenue without additional work or cost,” continues Rusk. “To implement the No-Burn system, builders do not have to delay construction or fill out a change order. A No-Burn specialist takes care of the paperwork and the product application, even meeting with the home owner personally to gain approval. The cost of using the No-Burn is added to the cost of the construction job, and builders enjoy an additional revenue source.” Says Rusk: “We believe that a fundamental shift is needed in the way society understands mold remediation. We have made it our mission to show people that cleaning up mold efficiently should be secondary to preventing it in the first place.” Farewell fire That’s the mold part of the story, but what about the fire part? Steve Shechter, director of communications for North American Safety & Preservation Associates (NASPA), a subsidiary of the Akron, Ohio-based Evans Agency, is a man on a mission. He is trying to persuade insurance companies to offer discounts on homeowners insurance to insureds whose homes use the No-Burn products. “No-burn is an intumescent fire retardant coating (IFRC) which, through scientific development, has surpassed the performance standards of older fire retardants,” says Shechter. “It is non-toxic, easier to apply, and more economical. Technically referred to as a topical ‘fire retardant,’ it has the effect of transforming ordinary wood to a non-combustible building material. Untreated lumber, typical to single- and multi-unit home construction, burns like kindling in a bonfire. I believe it will eventually go the way of thatched roofs and aluminum wiring. If insurance companies provide an incentive for using this technology, I believe it will have a dramatic effect in reducing the numbers of annual deaths, injuries and property losses resulting from household fires.” One insurer is already providing an incentive. After attending a live burn demonstration of No-Burn fire retardants at the Ohio Fire Academy to evaluate the life saving capabilities of this technology, Motorists Insurance Group of Columbus, Ohio, issued a premium discount bulletin. Motorists’ rate filings call for superior construction classification for homes properly treated with No-Burn. “This constitutes a 15% discount. The change was effective September 15, 2005, in Kentucky, October 1 in Ohio and will be effective January 1, 2006, in Iowa.” (As of press time, effective dates had not yet been determined in Pennsylvania and West Virginia.) NASPA presented its Innovator Award to Motorists last September for exhibiting “a progressive vision and humanitarian interest.” However, Shechter believes the word must get out to other insurers. “The insurance industry has long recognized, through substantial rate credits, the value of automatic sprinkler systems. It is in the best interest of insurers, regulators, insureds, and the public to apply the same level of informed discretion to the matter of combustibility and flame retardant technology. * For more information: |
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