Posted on May 17, 2014
Like never before, companies are increasingly faced with additional federal and state regulations concerning the environment. When a property or business must prevent or clean up contamination, they face delays and major expenses associated with maintaining safety and following environmental laws.
Because of increased awareness and enforcement, businesses in many industries require environmental liability insurance. The growing demand for this type of coverage is needed for companies that acquire businesses and then learn of environmental issues and liabilities associated with that newly purchased company. Utility deregulation, military base sales and commercial real estate also created the need for insurance protection since properties associated with these industries have potential risk and exposure for hazardous chemicals and waste that must be properly disposed of.
Environmental liability insurance covers various risks based on the size and type of company involved. Pollution, property damage, business interruption, cleanup, legal defense fees and contaminant transportation are all risks that must be handled by these specialized policies. Because of the high dollar cost associated with environmental liability claims, many of these policies start at covering losses of $100 million with some insurers offering double that amount.
With the growing demand for protection from environmental costs, insurers are adding to existing policies by offering additional coverage for:
Insurance brokers can assist companies with determining the coverage that will provide the best protection from environmental liability issues. Properly assessing risk is the first step to understanding what environmental insurance will be needed to fully protect your company.