A Decade of Environmental Claims

In addition to environmental liability trends, environmental regulation development and implementation have continued to evolve and change. Environmental insurance has become more prevalent for many insureds through transactions, development, contracting etc. As the market for environmental insurance increases, the book for environmental claims has evolved.

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Site Redevelopment:

A site which had been purchased five years prior and insured under a premises policy was being redeveloped into multi-family residential units. During the development process, soil was being removed from the basement and testing revealed lead and other wastes. Upon further testing, a “hot spot” was identified that required removal and disposal from the build site.

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A general contractor, building a large senior living complex using wood frame construction, experienced frequent rains during the early stages of construction. Unfortunately, this led to delays in the work, allowing the wood frame to be exposed to the weather for extended periods. As a result, water damage and significant mold growth occurred. This appeared to require tearing out all existing work that had been done, causing a delay in construction. Luckily, through the involvement of the insurance carrier, a mold remediation plan was put in place allowing work to continue on schedule.

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The presence of legionella was detected in the hot water system of a resort property. The state health regulatory agency became involved and a qualified consultant was hired to investigate and remediate the property. A claim was made immediately for the remediation and what could have been an extensive and lengthy remediation process was completed efficiently – significantly reducing the length of business interruption for the resort owners.

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Operational Spills, Leaks & Upsets:

A beverage producer experienced an acid release from a cleaner they used at their facility. The acid, which was stored in bulk in above ground storage tanks (ASTs) on the property, was released as a result of a valve failure. Claims were made not only for the initial costs relating to clean-up of the acid, but also for claims arising from violations of their discharge permits due to pH levels above limits.

  Download 2020 Industry Trends Claims Scenarios

  Download 2019 Industry Trends Claims Scenarios

Interested in learning more about these evolving trends in our industry?

Our team of experienced underwriters, dedicated claims handling unit and technical support staff understands the unique environmental exposures depicted above and can help tailor a policy to find acceptable coverage and claim solutions for your clients!

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The claim scenarios in this newsletter are provided to illustrate the variety of environmental exposures faced by your clients. The facts of any situation which may actually arise and the terms, conditions, exclusions, and limitations in any policy in effect at that time are unique. Thus, no representation is made that any specific insurance coverage applies to the above claim scenarios.

Any insurance product and coverage descriptions in this newsletter are summarized. Please refer to the actual policy declarations and policy form for a complete description of all applicable terms, conditions, limits and exclusions. The insurance products described in this newsletter may not be available in all jurisdictions. Products are underwritten by Great American E & S Insurance Company, a surplus lines insurers. We also have the ability, in many states, to offer admitted paper through Great American Insurance Company, following the applicable state’s deregulation or exemption guidelines. The information presented herein is not intended as a solicitation or offer to sell any insurance product in any jurisdiction in which such solicitation or offer, or any sale or purchase of the described insurance products would be unlawful under the insurance laws and regulations of such jurisdiction.