Class 4 water damage, in general, means that “specialty drying situations” are needed in order to extract the moisture from the area that the water infiltrated. This consists of setting humidity levels with which to remove the moisture from such materials as carpet padding, wood and wood composites. These material are often found in the backing of interior trim panels and act like sponges when submerged. These present a challenge when repairing a water damaged vehicle as mold can start to grow in and around them because they tend to stay wet and not dry out very quickly.
For more info, see 4 Facts About Car Water Damage