Editor's Note: This article originally appeared in National Underwriter, P&C.

Federal agencies are advising homeowners that "problem drywall," which has sparked thousands of claims, should be replaced along with other components the drywall may have corroded.

The new "interim remediation guidance" was issued by the U.S. Department of Housing and Urban Development (HUD) and the U.S. Consumer Product Safety Commission (CPSC) to help homeowners struggling to rid their properties of drywall produced in China and linked to corrosion of metal and electrical components in their homes.

Homeowners in 32 states--but mainly in Florida, Louisiana and Virginia--living in houses built using drywall imported into the country from China between 2004 and 2007 have lodged claims that the material created foul odors; corrosion of pipes, coils and wiring; damage to furniture, fixtures and jewelry; as well as health problems that include respiratory ailments, headaches, coughing and fatigue.

Legal action that has resulted has seen actions against wallboard manufacturers and builders. Insurers have rejected claims against homeowners policies on the grounds that policy language excludes them.

The CPSC and HUD guidance recommends replacement of all possible problem drywall, fire safety alarm devices, electrical components and wirings, and all gas service piping and fire suppression sprinkler systems.

"Taking these steps should help eliminate both the source of the problem drywall and corrosion-damaged components that might cause a safety problem in the home," HUD and CPSC said in a statement.

The agencies said the guidance represents a "conservative, common sense approach to the challenges facing homeowners, and is offered in advance of a complete understanding of certain scientific matters at issue."

They added that the guidance was being released now with the recognition that many homeowners want to begin the process of repairing their homes.

"The task force recognizes that less extensive or costly remediation methods may have merit, but at present the task force lacks a scientific basis to evaluate those methods," the guidance states.

HUD and CPSC said studies up to now have shown a connection between certain Chinese drywall and corrosion in homes, with a link that suggests hydrogen sulfide is causing the corrosion. CPSC is continuing to look at long term health and safety implications, the statement said.

Meanwhile, a representative of the Insurance Information Institute said homeowners should heed the guidance, but that it does not change anything from an insurance standpoint.

Most homeowners policies, according to Loretta Worters, vice president of the I.I.I., exclude damage resulting from "faulty, defective, or inadequate" products.

Ms. Worters said, "The policyholder is not charged a premium for losses which may arise because of these excluded occurrences, and the insurer does not provide coverage when [they occur]."

She continued, "To make an analogy between this and what's happened with the auto recall, no one ever thought of filing an auto insurance claim when they had faulty parts on their cars, and this is the same thing. If the part is defective, it's the manufacturer that is responsible."

She noted that Florida Insurance Commissioner Kevin McCarty said publicly in Nov. 2009 that drywall-related losses were excluded under standard homeowners insurance policies.

Ms. Worters also mentioned that U.S. Senator Bill Nelson (D-Fla.), a former Florida insurance commissioner, told the Wall Street Journal and NBC Nightly News within the past week that if the Chinese manufacturers of defective drywall did not pay for the losses their product caused, the Chinese government should.

David Golden, director of commercial lines for the Property Casualty Insurers Association of America, said the guidance contains no insurance references at all, and is based on information that is "far from complete."

He said CPSC notes that the information is not complete in the guidance, and added that the task force is taking a "very conservative and safe approach" in what it's recommending.

Phil Gusman is associate editor of National Underwriter, part of Summit Business Media's P&C Magazine Group, which includes Claims.