A business may suffer pollution losses for years without realising it. Management need to be aware of this and realise the true extent of their environmental exposures. EnviroPro doesn’t differentiate between gradual and sudden pollution and covers both.
Although General Liability policies cover pollution caused suddenly and accidentally they probably won’t cover pollution caused gradually. This is important because it’s more common for pollution to be caused gradually than suddenly e.g. leaking pipes, repeated spills and leaks etc. Businesses need to understand this environmental limitation of their general liability coverage.
Gradual pollution damage
Gradually occurring pollution can cause substantial damage. It can be very hard to spot and go undiscovered for several years, travelling large distances and causing considerable contamination damage in the meantime. (Such as a gradual leak from an underground pipe finding its way into a stream or river).
A company suspected of causing environmental damage is ‘guilty until proven innocent’. EnviroPro covers defence and investigation costs, and provides specialist environmental support to make the best possible defence for the business.
Guilty until proved innocent
If an environmental incident occurs the Regulator will decide who they think is to blame and the accused will have to prove otherwise. Sometimes it’s assumed that the nearest activity to the incident has caused the damage.
The regulator's priorities
If a company is identified as having caused the pollution, proving their innocence may not be their only concern. The Regulator’s primary motive is to fix the problem as quickly as possible, not to find out who caused it. Any costs attached to the actions the company are instructed to undertake will have to be borne by the accused company.
Rapid expert support
EnviroPro gets the right experts in quickly to find out if it really is the accused business that has caused the problem. This could involve collecting samples and analysis to find out what the pollutants are, and whether the company is actually responsible for them.
Dealing with multiple envoronmental reulators, with wide ranging powers in an evolving legal landscape
England and Wales, Northern Ireland and Scotland have different environmental regulators. Damage to land, water and wildlife may involve different agencies in different countries, and other regulators like Local Authorities may get involved as well. EnviroPro provides the expertise to conduct all necessary regulatory liaison on the business’s behalf – no matter how complex.
Environmental authorities have considerable environmental powers. They can enter business premises, make site investigations, remove machinery and equipment and require any questions to be answered. In an emergency the authorities can carry out clean-up works on behalf of the business and charge the business for these costs – which are covered by EnviroPro.
Environmental legislation is volatile with laws still developing throughout the EU with unknown future implications for businesses. EnviroPro removes this uncertainty by automatically providing cover for any new regulations introduced during the policy period.
Some damage can tie the business up for many years
If a business causes serious contamination, water pollution or damages a protected species or habitat this is classed as Environmental Damage. This can embroil the business in complex and expensive clean-up operations lasting years. Note there are over 6,000 protected sites in the UK alone and many thousands more across Europe.
Clean Up strategies
The business that causes Environmental Damage has to develop plans and clean-up strategies to repair the site to its original condition – including compensation for the loss of benefits from the site (like flood protection and recreation) during the years while it’s being repaired.
Long term expertise
This is highly specialist work – EnviroPro provides the costs and environmental expertise to liaise with the necessary authorities, create the appropriate clean-up plans, and manage the clean-up operations, on behalf of the business, however long it takes.
Purchasing EnviroPro demonstrates the precautions that the business has taken with its environmental responsibilities. It aims to resolve the clean-up as soon as possible whilst covering the costs of specialist PR support to advise the business, develop communication strategies and minimise the reputational damage.
For businesses that cause contamination, clean-up works can be very conspicuous. The noise and nuisance of vehicles and equipment involved in dealing with an incident can all raise awareness of the site works to local communities. EnviroPro can help minimise the reputational damage.
Also the media are very sensitive to local pollution scares. Prosecutions and offending companies are routinely reported in the Environment Agency’s media centre, and these in turn may be picked up and amplified by local media, naturally sensitive to local environmental issues – EnviroPro helps the business handle its media exposures.
EnviroPro covers investigations, defence costs and settlements for the business’s employees and for its past and present principals and directors.
Individuals face the possibility of personal actions for environmental damage. If directors or managers are found to have consented to the environmental offences committed by their companies they can also be prosecuted, and if guilty liable to fines and even imprisonment.
For cases tried in the Magistrates’ court, the maximum penalty is up to six months’ imprisonment, while for cases tried in the Crown Court, the maximum penalty is two years imprisonment.
If a business contaminates neighbouring property it faces a range of costs in addition to those of cleaning up the contamination, which are covered by EnviroPro.
Third party liabilities
The business could be liable for any personal injury or illness caused by the contamination and for damage to buildings and facilities caused by the contamination or by the clean-up operations. They could also be liable their neighbour’s for loss of use and business interruption costs. All these costs are covered by EnviroPro.
First party costs
The business may also have to contend with damage to its own site caused by any contamination, its own clean-up costs and also its own business interruption costs while the contamination is being cleaned up. These costs are also covered by EnviroPro.
Speciaist environmental claims support 24 hours a day 365 days a year
Environmental claims are highly technical and often require skilled resources to manage them. Following a claim, uninsured companies could end up paying substantial sums in in consulting fees and engineering support as well as direct costs related to the environmental claim itself. The necessary expertise to ensure optimum claims handling and the breadth of cover to ensure optimum claims settlement are all provided by EnviroPro.
When an environmental loss happens, it is important to involve the right people as soon as possible. Most companies haven’t dealt with an environmental loss before and may not know who turn to. At AIG we have dedicated environmental claims handlers to manage claims and our Pollution Incident Environmental Response network offers businesses local, specialist environmental support – 24 hours a day 365 days a year.