Understanding Pollution Insurance & Critical Coverage Gaps

Environmental liability insurance fills the dangerous coverage void left by general liability policies. Standard general liability and property insurance policies exclude most losses connected to pollution with very few exceptions, leaving businesses exposed to potentially devastating costs.

What Triggers the Need for Environmental Liability Coverage?

Your business faces environmental risk management challenges that require specialized protection:

• Contamination Coverage: Accidental chemical spills, fuel leaks, or hazardous material releases

• Third-Party Liability: Bodily injury or property damage claims from neighbors or employees

• Regulatory Compliance: EPA cleanup requirements and environmental violations

• Remediation Costs: Soil and groundwater cleanup expenses that can exceed $500,000

• Legal Defense: Environmental lawsuits and regulatory enforcement actions

According to market experts, the frequency and severity of environmental claims is expected to see an increase in 2024, making protection more critical than ever.

Cost Reality Check: Pollution insurance can cost between $11,000 and $15,000 per year for $10 million in coverage, translating to approximately $1,100 to $1,500 per million dollars of coverage annually.

Types of Environmental Liability Coverage We Offer

Pollution Legal Liability (PLL) Insurance

Pollution Legal Liability coverage protects against claims arising from contamination on your property. This site pollution coverage addresses:

• Cleanup Costs: Soil remediation and groundwater treatment expenses

• Third-Party Claims: Bodily injury and property damage from pollution migration

• Business Interruption: Lost income during environmental remediation

• Legal Defense Costs: Attorney fees for environmental litigation

Contractors Pollution Liability (CPL) Insurance

Environmental impairment liability protection for contractors working with hazardous materials. The CPL market is very soft right now with a lot of capacity and carriers vying for this line of business, creating favorable pricing opportunities.

CPL Coverage Includes:

• Site Pollution: Contamination caused during construction activities

• Transportation Coverage: Hazardous material transport incidents

• Professional Services: Environmental consulting liability protection

• Remediation Expenses: Cleanup costs from contractor operations

Environmental Impairment Liability (EIL) Insurance

Comprehensive environmental risk management solution covering both sudden and gradual pollution incidents. This coverage addresses:

• Historical Contamination: Pre-existing site conditions discovered during operations

• Brownfield Redevelopment: Coverage for contaminated property rehabilitation

• Underground Storage Tank: Leaks and soil contamination from UST systems

• Environmental Consultants: Professional liability for environmental services

PFAS & Emerging Contaminant Protection

Critical PFAS Coverage Updates for 2025

PFAS (Per- and Polyfluoroalkyl Substances) represent the most significant emerging environmental liability risk. In April 2024, EPA finalized a critical rule to designate two widely used PFAS – PFOA and PFOS – as hazardous substances under CERCLA.

Why PFAS Coverage Matters:

• Forever Chemicals: PFAS persist in the environment indefinitely, creating long-term liability

• Regulatory Expansion: The final rule will reduce PFAS exposure for approximately 100 million people

• Litigation Surge: At least fourteen PFAS-related coverage actions have already been instituted in ten states nationwide

• Coverage Exclusions: It is becoming industry standard to see PFAS-specific exclusions on CGL policies

Specialized PFAS Insurance Solutions

Our environmental liability insurance policies include PFAS protection options:

• Legacy PFAS Coverage: Older policies without PFAS exclusions may provide coverage

• Specialized Environmental Policies: Custom coverage for PFAS contamination risks

• Professional Liability: Coverage for environmental consultants handling PFAS investigations

• Regulatory Compliance: Protection against evolving PFAS regulations

Industries That Need Pollution Insurance

Manufacturing & Industrial Operations

Hazardous waste handling, chemical processing, and industrial manufacturing require comprehensive pollution liability protection. Key risk factors include:

• Chemical Storage: On-site hazardous material inventory creating spill risks

• Waste Generation: Industrial byproducts requiring specialized disposal

• Air Emissions: Potential releases requiring EPA compliance monitoring

• Water Discharge: Industrial effluent creating downstream contamination risk

Construction & Contractors

Excess limit capacity has notably contracted, with carriers now typically offering US$5m to US$10m in coverage, compared to previous limits of up to US$25m, making proper coverage selection critical.

Construction Risk Exposures:

• Soil Disturbance: Uncovering historical contamination during excavation

• Fuel Storage: On-site diesel and gasoline creating spill potential

• Hazardous Materials: Asbestos, lead paint, and mold exposure during renovation

• Underground Utilities: Damaging pipelines or storage tanks during construction

Property Owners & Real Estate

Environmental risk assessment is essential for property transactions and ongoing ownership liability:

• Due Diligence: Environmental site assessments revealing contamination

• Tenant Operations: Third-party activities creating pollution liability

• Historical Uses: Former industrial operations leaving residual contamination

• Groundwater Migration: Off-site contamination impacting property values

Smart & Easy Environmental Risk Management Solutions

Our Proven Protection Process

1. Risk Assessment: We evaluate your specific environmental exposures and regulatory requirements

2. Coverage Analysis: Compare multiple carrier options to find optimal protection at competitive rates

3. Policy Customization: Tailor coverage limits, deductibles, and endorsements to your risk profile

4. Ongoing Support: Proactive policy reviews and claims assistance when environmental issues arise

Why Choose The Allen Thomas Group for Environmental Liability?

Local Expertise, National Reach: Based in Akron, Ohio, serving over 20 states with specialized pollution legal liability knowledge

20+ Years Experience: We simplify the complex insurance process, saving you time and money on environmental coverage

Carrier Relationships: Access to multiple environmental insurance providers ensures competitive pricing and comprehensive coverage options

Claims Support: Our team provides expert guidance during environmental incidents and regulatory investigations

Frequently Asked Questions About Pollution Insurance