Pollution liability insurance is for companies and trades-people who would like to control risks related to building and continuing industrial operations, including damaged pipelines, fuel leaks and release of toxic gases. It’s a type of gap insurance plan, as most standard liability policies rule out pollution risks. Various pollution insurance providers offer various terms, and may even rule out or charge extra for risks they consider to be particularly onerous.
Who Buys It
General contractors doing work in the commercial, residential and municipal building sector typically buy pollution liability insurance, just as building contractors involved in constructing roadways and sewers; carrying out routine maintenance, demolition and excavation; and operating at industrial facilities. Remediation contractors may need to buy this kind of insurance policy in the event they get a new cause of contamination whilst cleaning up a contaminated site. Other companies that may need liability insurance include things like “airports, pig farms, storage yards, fueling facilities and composting businesses”.
What It Covers
Pollution liability insurance generally protects injury to others, including neighbors harmed by the discharge of toxic substances. It may well also insure property damage, for instance an oil spill on the property near a road. Some policies cover legal fees for contractors who experience law suits for pollution related incidents, or the expense of clearing up a site following a pollution incident.
The Rise of Pollution Liability Insurance
For many years a businesses key environmental dilemma was being named partially accountable for polluting a site and found themselves snarled in many years of Superfund litigation, as outlined by Pollution Engineering. But over the years, modern society grew to become much more conscious of pollution hazards, and clean-up expenses grew to become costlier. Quite a few insurance providers begun eliminating pollution hazards from them insurance policies, requiring companies to acquire added insurance to cover this risk.
Coverage Limits and Deductibles
Insurance policies can cover as low as $1 million and as much as $50 million in risk, with regular policies covering between $5 million and $10 million. Deductibles, or how much money a contractor has to shell out just before insurance cover will begin paying out, range from $10,000 to $1 million.
Insurance policies may vary among insurance carriers. In particular, some policies may well exclude coverage for lead based paint in buildings, mold, asbestos or low-level radioactive elements. Consumers of pollution liability insurance really should evaluate the insurance agreement very carefully to ascertain coverage restrictions and exclusions.