5 Contractor’s Pollution Insurance Claim Scenarios Brokers Need to Know
As an insurance broker, you understand that the construction industry is fraught with risks, including potential environmental hazards. Pollution incidents can result in significant contractor liabilities, leading to costly claims, lawsuits, and a financial impact to the contractor’s bottom line. That’s why Contractor’s Pollution Legal Liability Insurance is critical for protecting your clients. In this article, we’ll explore five Contractor Pollution Insurance claim scenarios you need to know about.
Soil Contamination
A street and road contractor repaved a major highway adjacent to a creek. A tack coat was sprayed onto the sub-base before paving activities, which were to commence the following day. An overnight thunderstorm washed the tack coat into the adjacent creek, contaminating the water and causing a fish kill. The contractor did not follow best practices or the manufacturer’s recommendations for applying the tack coat. The cleanup of the creek and expenses for Natural Resource Damages exceeded $200,000.
Water Pollution
A utility contractor was replacing a municipal water line in a commercial building. During the excavation of the old line, the contractor struck an adjacent sewer line, causing the release of sewage into the basement and the surrounding area. The sewage clean-up costs were close to $300,000.
Indoor Air Quality
Construction activities can affect indoor air quality, particularly in projects involving demolishing or renovating older buildings. An electrical contractor installed new electrical lines in a historic building that contained asbestos insulation. The contractor unknowingly disturbed and released asbestos fibers throughout the building by cutting into the ceiling. The contractor was responsible for cleanup costs and third-party business interruption losses of over $500,000.
Mold and Fungi
Mold and fungi can thrive in moist environments, such as those created by construction projects. A roofing contractor replaced a roof on a commercial building and improperly installed a waterproofing seal, the resulting mold growth causing respiratory problems and other irritations for the building’s tenants. The contractor was sued for the tenants’ alleged bodily injuries and the costs of repairing the waterproofing seal. Total damages from these claims were more than $250,000.
Legionnaires’ Disease
A plumbing contractor installed a water circulation system in a new high-rise hotel. Several months after the hotel opened, guests became ill from legionella pneumophila. An investigation determined that the cause was water stagnating within the pipes due to the contractor’s improper installation of the system. Hotel guests filed lawsuits against the property owner and contractor for bodily injury claims resulting from the legionella pneumophila for over $2,000,000.
How Distinguished Can Help
Environmental hazards are an ever-present risk in the construction industry, and Contractor’s Pollution Legal Liability Insurance can provide essential coverage for contractors facing pollution-related claims and lawsuits. By understanding these five common scenarios, insurance brokers can better advise their clients and ensure they have appropriate coverage.
If you’re an insurance broker looking to provide your clients with the best protection against pollution-related risks, consider offering Contractor’s Pollution Legal Liability Insurance. Contact us at Distinguished Programs to learn more about our environmental insurance solutions and how we can help you meet your client’s needs.
About Distinguished Programs
Distinguished Programs is a leading national insurance Program Manager providing specialized insurance programs to brokers and agents with specific expertise in Fine Art and Collectibles, Environmental and Construction Professional, Executive Lines, Inland Marine, Real Estate & Builder’s Risk, Community Associations, Hotels, and Restaurants. Property and Liability products are distributed through a national network of agents and brokers. Serving the same core markets and partnering with the most stable and reputable carriers, Distinguished’s high-limit Umbrella programs remain the clear choice in its area of specialty for superior coverage, competitive pricing, and attentive service. Through thoughtful innovation, stemming back to 1995, Distinguished Programs fosters growth and opportunities for its brokers, carriers, and employees.
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DISCLAIMER: The information contained herein is intended for marketing and summary purposes only. Insurance coverage in any case will depend upon the type of policy in effect, the terms, conditions, and exclusions in any such policy, and the facts of each unique situation. This document does not provide a complete description of coverage terms, conditions, or limits, nor does it purport to restate, explain, or interpret any insurance policy. Only the applicable policy contains a complete description of all the provisions of the coverage.
