Mold, Disabilities, and the Fair Housing Act: Legal Risks for Landlords and Insurers

The intersection of mold exposure, disability claims, and housing law is emerging as a high-stakes battleground for landlords, insurers, and claims professionals. With courts across multiple states reviewing Fair Housing Act (FHA) complaints based on alleged mold-related disabilities, claims adjusters are seeing a rise in disputes over what constitutes a reasonable accommodation — and whether the alleged disability meets the FHA’s legal definition.

Recent cases underscore how tenants increasingly link mold exposure to conditions like asthma, chemical sensitivities, and autoimmune disorders. But the courts have generally demanded solid documentation of both the medical condition and the necessity of the requested accommodation. In Fedynich v. Stalkfleet, for example, a federal judge ruled that Social Security disability benefits alone do not prove disability under the FHA if they’re unrelated to the specific accommodation requested. Similarly, in Graves v. Foulger-Pratt, tenant allegations of environmental illness failed without medical proof of a recognized impairment.

For claims professionals, these rulings highlight critical fault lines. Mold-related habitability issues are being reframed by tenants as disability discrimination claims, raising the stakes for property owners, liability insurers, and their legal counsel. The Holden decision even called out this strategy directly, rejecting a lawsuit that tried to repackage habitability complaints into a failure-to-accommodate claim.

Insurers and adjusters must also navigate the growing use of non-standard, DIY mold testing kits and unverifiable third-party documentation. The HUD/DOJ Joint Statement permits a broad range of documentation sources — including peer groups and laypersons — but that latitude creates uncertainty around claim validity and defensibility. Given this context, insurers handling property or habitability claims involving FHA violations should ensure landlords engage qualified legal counsel early and document all requests and responses meticulously.

As mold-related complaints multiply and overlap with fair housing regulations, claims professionals must carefully evaluate medical documentation, accommodation reasonableness, and legal risk exposure. Failure to understand how courts are parsing disability definitions and accommodation thresholds could lead to costly litigation or regulatory action — especially in jurisdictions where local governments, like Buffalo, are taking aggressive stances against landlords.