Environmental insurance coverage is an often-overlooked type of policy for businesses outside of the typical pollution-causing industries such as chemical, manufacturing, mining or construction. Most business owners think environment coverage is meant for companies who deal with “hazardous waste,” however, pollutants can be anything from mold, bacteria and fungi to asbestos or lead. Nearly every type of businesses has at least one type of environment exposure risk, and though pollution events are infrequent for most businesses, when they do happen they can be very costly. Most commercial insurance policies contain pollution exclusions that leave significant gaps in coverage for businesses and organizations, so it’s important for insurance agents to help businesses fill in those gaps with the proper environmental coverage.
Here are three of the most common environmental coverage mistakes that insurance agents make:
- The policy is not the right fit for the client. With no set industry standards for the coverages offered in an environmental insurance policy and well over 100 different types of environment insurance policies designed to cover different risks and industries, it’s very easy to accidentally sell a policy that isn’t really right for the client.
- The agent failed to address pollution exclusions in the environmental policy. Environmental liability coverage is designed to cover all pollution events but there are still exclusions as with any insurance policy. Exclusions can include: damage that was intended or should have been reasonably expected by the insured, damage to the insured’s own property, bodily injury to any employee of the insured or damages resulting from willful non-compliance with the law. Most of these exclusions could be addressed through different commercial policies, which agents should make clients aware of.
- The agent didn’t properly address preexisting pollution conditions. Pollution liability insurance covers claims and costs associated with pollution conditions that develop during the policy period. A phase I site study is necessary to determine whether there are any known contaminants. If there are, then a phase II site study will need to be done, and the contaminants found will likely be listed as exclusions in the policy. If preexisting pollution conditions aren’t properly addressed in the policy, the client may not be covered from future pollution claim related losses.
Navigating the multitude of environmental coverage options can be tricky for insurance agents, but partnering with the right insurance wholesaler and avoiding commonly made mistakes can help agents ensure their clients are properly covered for all possible environmental risks.
Formed in 2013, AmSuisse, Inc. has quickly distinguished itself as a wholesale operation that specializes in working very closely with our agents and broker partners to develop responsive, individualized service for each client. Our unparalleled writing support, industry-specific expertise, marketing support, responsive proposals and quotes, strong customer service, and strong relationships with our carrier partners have all helped us to provide the best possible coverage for our clients. To learn more about our available coverage, contact us today at (800) 485-0229 to speak with one of our representatives.