Claims adjusters need to know and follow the updated EPA law on lead paint.
Friday, March 04, 2011
Claims Advisor Magazine
In April 2010, the Environmental Protection Agency (EPA) issued the Renovation, Repair and Painting Rules (RRP) requiring the use of lead-safe practices during home renovation, repair and painting projects to prevent lead poisoning and lead toxicity. Under the new rule, contractors performing projects that disturb lead-based paint in homes, child-care facilities, and schools built before 1978 must be certified and follow specific work practices to prevent lead contamination. This rule affects approximately 69 million homes in the United States—nearly 80% of all residential dwellings.
Many states are being approved by the EPA to take over the full administration of this program and are establishing additional lead paint regulations and rules. It is critical to keep track of both federal and state requirements. Claims departments should maintain a list of contractors that are lead-certified by the EPA and be ready to recommend a qualified contractor to policyholders. Keep in mind, contractors that take the time to have their workers certified may be more expensive than those that don't, which could affect the cost of repairs. On the other hand, the upfront expenditure on quality could eliminate secondary costs resulting from contamination.
Understanding the Law
Contractors are obliged to take three simple steps when dealing with lead paint exposures: Contain the work area; minimize and limit the spread of dust; and thoroughly clean up the area.
The new rules do have exceptions. The regulations generally do not apply to maintenance projects in which less than six square feet of lead-based paint is disturbed in a room or less than 20 square feet of lead-based paint is disturbed on the exterior, but this does not include window replacement, demolition or prohibited practices. (Note: The EPA RRP rules are not aligned with certain other federal agencies. When working in HUD property (any property that receives federal subsidies), it is important to be aware of the appropriate HUD regulations.)
Originally, homeowners could opt out of having their contractors follow lead-safe work practices in their homes if they met certain requirements. However, the opt-out option was quashed in June 2010 to better enforce the purpose of the RRP regulations to prevent lead paint poisoning.
In addition, many states are being approved by the EPA to take over the RRP program and are enacting their own lead paint rules and policies. (To see states and their status, go to http://www.healthyhomestraining.org/rrp/State.htm, or http://www.epa.gov/lead/new.htm.) The first and most important step for insurance adjusters is to get educated. At this writing, 12 states have individual programs and others are in the filing stages.
Reviewing the Claim
Some steps that all claims adjusters should follow for each and every claim include:
Testing for lead-based paint. There are two approaches to testing:
- Test all paint. Using this approach, the restoration professional tests all layers of paint—the top coat and all layers below that. The current owner may not even be aware of those layers. Whenever there is any doubt, the restoration professional must make a "presumed lead" declaration and proceed accordingly. Only if all of the tests come back clearly negative would the restoration professional conclude there is no lead-based paint in the area. Whenever the restoration professional makes a negative finding, the adjuster should request a copy of all testing data to verify the results, including photos of the test results.
- Assume there is lead-based paint in the work area. Many professional restoration companies are adopting that position for all homes built before 1978. This assumption provides the greatest degree of safety and eliminates the possibility of their work (even unknowingly) generating lead contamination to the indoor environment.
- Educating the policyholder about lead hazards. Many property owners are completely unaware that their homes could be contaminated with lead-based paint and have no knowledge of the potential dangers. The claims adjuster should be prepared to educate the policyholder on the dangers of such a situation, should it exist. Lead-based paint contamination can occur any time the painted surface is disturbed (cut, torn, sanded, repaired, etc.). Those disruptions can result from a number of disasters, including fire, wind, water and smoke. The restoration professional is required to provide a specific EPA pamphlet to every property owner and occupant of property built before 1978. This pamphlet is required regardless of any test results. There is also a specific EPA form that the restoration professional is required to use to confirm delivery of the pamphlet. The claims adjuster should confirm that the pamphlet is provided when appropriate.
- Making sure proper procedures are followed in order to provide an accurate estimate. Claims adjusters are responsible for providing an accurate estimate through the examination of the damages and for approving the cost of restoration. If proper procedures are not followed by the restoration professional, it can dramatically affect the total cost of the restoration/repair. Often, the use of a lead-paint qualified, certified contractor is central to cost savings because secondary problems and supplemental claims are avoided.
Finding the Right Partner
The first step should be to contact a reliable restoration company with proof of proper certification on lead-based paint rules. Some companies require that all of their contractors be lead paint certified. For each and every restoration project, certified contractors should provide a copy of their EPA or state lead certification and give details of the lead-safe methods they will use to perform the job.
Not only do renovators need to be lead certified, so do inspectors, designers, supervisors, lead abatement contractors, and sampling and risk assessment firms. If you use independent adjusters, they should be savvy on lead-based paint requirements and certified firms. The EPA offers a national locator for renovation, repair and painting firms that they have certified (http://cfpub.epa.gov/flpp/searchrrp_firm.htm), but authorized states that administer their own programs may also provide a locator service. Several states provide online databases or listings through their health department websites.
Lead certifications do expire, so check with the EPA or state department of health to make sure all certifications are current. Naturally, all providers should carry appropriate insurance, and abatement contractors should cover costs associated with failing a clearance test at the end of their work. Having a standard contract and checklist for such work could help ensure that all claims dealing with lead-based paint work go smoothly. Check the EPA website and your state health department for a boilerplate that might help.
Will Southcombe, BA, MA, MBM, CMR, WRT, ASD, is the director of Training & Technical Services for PuroClean's North American headquarters. firstname.lastname@example.org
April 6, 2011