Articles Posted in Pollution Exclusion

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Danger Hazardous Chemicals Sign on a stained storage barrelA key component of a company’s risk management function is to keep a close eye on new and developing sources of liability and to put in place appropriate insurance to respond in the event those liabilities ripen. In recent years, there has been a significant increase in legal and regulatory attention on per- and polyfluoroalkyl substances, more commonly known as “PFAS” or “forever chemicals.” PFAS are used in countless applications, and many companies across the country bear potential liability, from chemical companies to manufacturers to retailers to corporate end users. PFAS-related enforcement is focused on remedying impacts to both the environment and human health. Importantly, a company’s liability for PFAS-related contamination or bodily injury may be covered under historic general liability policies and/or modern-day pollution liability policies. As regulation and litigation relating to these ubiquitous substances continues to surge, corporate policyholders with potential exposure should be proactive to examine their insurance portfolios and position themselves for potential insurance coverage in the event they become a PFAS liability target.

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iStock-118265197-mask-300x200There has been a drumbeat of news reports about Wuhan, China, a city more populous than any in the United States, which is in effective lock-down because of the coronavirus. Foreign nationals are being evacuated, travel has been restricted, and business is at a standstill. At a time like this, preserving public health is the highest priority. But businesses, both local and global, are also affected by shut-down orders, disruptions to their supply chains, mass sick days, and loss of business. Many, especially providers of hospitality or health care, may face elevated liability risks for exposing others to a contagion. It is important to remember that insurance may be available to meet these risks.

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The Flint, Mich., water crisis returned to the news recently as criminal charges were brought against additional government employees resulting from the crisis. Meanwhile, a federal court in iStock-172241371-drain-200x300Pennsylvania recently issued a ruling in an insurance case that, like Flint, related to alleged contamination in drinking water stemming from corroded pipes. The decision rejects two insurers’ attempts to avoid coverage and serves as a good reminder of some fundamental insurance law principles—the duty to defend is broad, ambiguous policy language usually is construed against the insurer, and policies should be interpreted in favor of their purpose to provide coverage. It is also a reminder that the pollution exclusion is not nearly as all-encompassing as insurers like to think it is.

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As we edge further into the summer months, many contractors see an increase in work volume with longer days and universally better weather. That said, Mother Nature is not always predictable, and an unexpected storm can quickly lead to a flash flood, or other natural disaster that might result in what insurers may classify as a pollution event. Even something seemingly as innocuous as water run-off from a job site following a summer shower has the potential to result in a third-party claim against a contractor for damage.Colorful macro of local automotive pollution Thus, it is imperative that contractors have the right pollution coverage in place to remain secure and profitable.

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In Texas and other states, the mineral owner can freely use the surface estate to the extent reasonably necessary for the exploration, development and production of oil and gas. That includes activities such as building roads, drilling wells and transporting equipment and personnel. But frustrated property owners are incrIllustration of three oil rigs in the deserteasingly bringing nuisance claims based on bright lights, loud noises, traffic, dust, odors, wastewater and other effects of these activities.  A question facing the oil and gas industry is whether the costs of such nuisance claims are covered by insurance.

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