Today's property and liability insurance policies provide very limited coverage for claims arising out of pollution. All organizations should conduct an analysis of the potential pollution/contamination loss exposures within their operations. They should review how their present insurance program provides coverage for claims arising out of pollution including mold, fungus and bacteria contamination.
Pollution claims not covered by your current insurance may arise from the following areas:
- Use of any chemicals including solvents, degreasers, paints, cleaning products, fuels, pesticides, herbicides, etc. One of our clients recently had an incident where workmen mixed the wrong chemicals together creating dangerous fumes and the part of the building where they were working had to be evacuated for several weeks.
- Waste disposal practices.
- Mold, fungus and bacteria contamination.
- Malfunction of heating or ventilation equipment, e.g. carbon monoxide poisoning.
- Fire to old electrical equipment including transformers containing PCB's. One of our clients had this happen and PCB's were released into the ground. The clean up cost was over $300,000.
- On site pollution clean up costs when there is a serious property loss, e.g. asbestos removal and disposal after a fire.
- Transportation of hazardous materials within your operations.
- Leakage of underground or above ground storage tanks.
- Contamination of your products.
Consider obtaining a quotation for separate pollution insurance. Once a separate pollution insurance quotation has been obtained, you can evaluate the benefits of purchasing this coverage versus self insuring the potential pollution/contamination exposures not covered by your present property and liability insurance policies.
