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Member, Beacon International Group, Ltd.
WASHINGTON—The Drywall Victims Insurance Protection Act, introduced by U.S. Rep. Charlie Melancon, D-La., would bar insurance companies from canceling or refusing to renew the policies of homeowners who have Chinese-made drywall in their home.
The bill introduced Tuesday also would bar insurers from changing rates or altering the amount of coverage based on problems stemming from the drywall and would protect homeowners’ rights to sue their insurance companies if their coverage is dropped because of Chinese drywall.
The drywall covered by the bill either originated in or was imported from China from 2004 through 2007, or contains abnormal levels of strontium or sulfur.
To date, the Consumer Product Safety Commission has received about 1,897 complaints from homeowners. Consumer advocates estimate that between 4,000 and 7,000 U.S. homes were built with drywall manufactured in China, with property damage estimated to reach as high as $3 billion, Rep. Melancon said in a statement.
The problem stems from 500 million pounds of drywall that was imported to the United States from 2004 through 2007 when the Southeast was rebuilding after Hurricane Katrina. The drywall was traced to Chinese subsidiaries of German manufacturer Knauf Plasterboard Tiajin Co. Ltd.
Several small private insurance have already filed motions in court saying they are not obligated to cover damages caused by the tainted drywall based on exclusions in their policies. So far, no large commercial insurers have taken similar action.
Early environmental studies conducted by Florida health officials found that gypsum wallboard used in home construction was tainted with strontium sulfide and elemental sulfur that, when exposed to high levels of humidity and heat, produce a gas strong enough to corrode copper wiring, pipes and appliances.