When it comes to environmental risks, images of oil spills and smog-choked skies often dominate our thoughts. We tend to associate pollution liability with industrial giants – refineries, factories, and power plants. While these concerns are certainly valid, the world of pollution risks extends far beyond the obvious culprits. There’s a myriad of businesses and entities out there, quietly facing environmental threats that could cripple them financially. Enter environmental insurance – the unsung hero that shields these stakeholders from unforeseen environmental perils.
In this article, we’ll delve into the world of environmental insurance and explore why it’s not just heavy industries that should be concerned. From contractors to property owners, real estate developers, investment groups, private equity firms, and even financial institutions, everyone has a role to play in safeguarding their interests against the often-hidden hazards of pollution.
Pollution hazards exist in all types of contracting work – from those involved in grading, excavation, and demolition to electrical, HVAC, mechanical, plumbing, roofing, street and road, and many other construction areas. “A mechanical contractor, for example, may improperly install a new HVAC system at a university dorm when students are away from the summer. The improper installation leads to too much humidity and eventually mold growth,” says David Lemond, VP Senior Underwriter, Distinguished. “The contractor could be on the hook for the costs to repair the HVAC, clean up the mold, and potential property damage.”
Distinguished provides contractors with Contractor’s Pollution Legal Liability Plus (CPL) policy, which is triggered in the event of a pollution condition resulting from contracting services or completed operations. The policy generally covers cleanup costs, third-party liabilities, legal defense expenses, emergency expenses, transportation, non-owned disposal sites (NODS), disaster management costs, and business interruption losses resulting from pollution incidents.
Distinguished can also provide coverage for professional liability exposures resulting from actual or alleged acts, errors, or omissions from professional services performed by or on behalf of the insured with our Contractor’s Pollution and Professional Legal Liability Plus (CPPL) policy.
Both policies are designed to be flexible and can be tailored to meet your client’s project or practice insurance requirements.
Commercial property owners of retail shopping centers, apartments, hotels, restaurants, manufacturing plants, etc. should also safeguard themselves against potential contamination issues on their properties. “There may be an indoor air quality or mold issue in an apartment building or hotel for which the property owner would be responsible for cleanup or potential bodily injury or property damage to tenants” explains David. “Or a large data center tenant may have backup generators that release oil or gas into the sewer drain and a nearby creek requiring cleanup or natural resource damage. Stored chemicals at a manufacturing plant could escape from an unknown leak and slowly accumulate, impacting soil and groundwater on and offsite. An offsite investigation identifies the impacts and the manufacturing plant is required to pay for the cleanup costs on and offsite.”
Distinguished provides property owners with Pollution Legal Liability insurance, which includes coverage for cleanup costs, bodily injury, property damage, and legal expenses for new and/or historical pollution conditions on, at, under, or migrating from or through a covered location or an indoor contaminant condition at a covered location.
Real Estate Developers/Investment and Private Equity Groups
Entities involved in the redevelopment of property face environmental risks. “Let’s say you have an investment group or individual interested in purchasing an urban property with a long history of commercial tenants,” explains David. “The group wants to redevelop the property with apartments or a warehouse. Typically, Phase I and sometimes Phase II environmental site assessments are performed prior to an acquisition to identify potential or existing environmental liabilities on a property. We have the expertise to review the documents and come up with creative underwriting solutions to address the exposures with our Pollution Legal Liability Plus (PLLP) policy.”
Financial Institutions & Lenders
Financial institutions and lenders are interested in protecting against pollution incidents on a borrower’s property. “If the property had environmental impacts from historical operations that were holding up the deal,” says David, “we could review the environmental reports and the financial strength of the borrower and offer unrestricted site coverage to the lender only. With Lender Liability Mortgage Protection insurance added to our Pollution policy, and the borrower defaults on the loan, the lender is the first named insured and will be covered for the cleanup costs or the outstanding balance of the loan, whichever is less. Very few markets provide this coverage.”
Why Distinguished As Your Go-to for Environmental Insurance
In a world where environmental risks can disrupt businesses of all sizes and types, choosing the right insurance provider becomes paramount. That’s where Distinguished comes into play. With a team of experts boasting a collective 300 years of experience in environmental, construction, and insurance-related fields, Distinguished offers a comprehensive suite of insurance products tailored to protect businesses from their unique environmental and professional exposures.
What sets Distinguished apart?
- Our customer-centric approach and state-of-the-art systems enable us to provide a full suite of products to cover fixed facilities, contracting services, and professional liability with both primary and excess capabilities.
- We strive to deliver bindable quotes to you as fast as possible. We typically provide a quote in three days, although expedited options can be arranged in certain situations.
- Our underwriting flexibility allows us to modify policies to evolve with your client’s changing needs so that they always have coverages and policies that make sense for them.
- A dedicated, in-house team of expert attorneys handles claims efficiently and fairly. Our top-notch claims handling helps clients feel at ease, knowing they are well-protected and in good hands during difficult times.
How to Get Started with Distinguished
Get your clients the coverage they need with Distinguished’s Environmental and Construction Professional Insurance policies. It’s easy. First, sign your agency up with Distinguished. Next, fill out an application form and email it to our program head, Doug Stepenosky, at DStepenosky@distinguished.com.
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 & Collectibles, Environmental & Construction Professional, Inland Marine, Executive Lines, Real Estate, 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 Programs’ high-limit umbrella programs remain the clear choice in its areas 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.