Pollution liability coverage used to be included in most business insurance policies but that changed in the 1970’s with the emergence of many expensive asbestos claims. Now this coverage is largely excluded and must be purchased separately. Pollutions claims are not limited to large manufacturers. These claims can be filed by state and local governments, other businesses, landlords and people who live near your business. Do not allow a pollution claim to bankrupt your business; protect it with pollution insurance.
Pollution insurance is a type of coverage created specifically to manage the costs associated with pollution clean-up, as well as to cover liability claims for pollution-related injuries, illnesses or deaths. This type of commercial insurance was created in response to the problem that liability claims were bankrupting companies, and therefore victims were not being compensated.
Policies cover any type of small-scale pollution that causes contamination of soil, groundwater or property. They also provide coverage for air-borne contaminates like smoke and emissions. Many policies will even cover pollution that occurred in the past before the harmful effects of waste-products was known. For larger, more extensive pollution incidents, an environmental impact liability insurance policy may be needed.
When many people think of pollution insurance, they picture large factories with billowing smokestacks but many small businesses can benefit from this coverage. Any business that uses environmentally unsafe chemicals, such as a hair salon or a dry-cleaning service, runs the risk of a pollution lawsuit. Similarly, garages, junkyard and industrial manufacturers face these charges.
Even contractors who construct buildings have a need for pollution insurance if the work they do can affect long-term air or environmental quality. A specialized form of pollution insurance called contractors pollution liability insurance can meet the needs of the construction industry.