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What is Pollution Liability Insurance and Why it is Important?

At one time, general business liability insurance covered most claims involved with pollution, but the asbestos claims in the 1970s changed that. Now, most insurance liability policies don’t extend to cover pollution liability.

Any business has the potential to face a pollution liability lawsuit from their local government. These claims can be extensive and costly, and can sometimes be enough to put a company out of business.

What is it?
Pollution liability insurance policies are designed for businesses and contractors alike who want to protect themselves against the risks that come with construction and industrial operations; risks such as broken pipelines and fuel spills. Most general liability insurance policies exclude pollution risks.

Who Needs it?
Any contractor or company whose work involves potentially harmful pollutants or chemicals should have pollution liability insurance. General contractors working in both commercial and residential environments often purchase pollution liability insurance, as do contractors involved with road building and sewers. Those working in industrial facilities and remediation companies often purchase a pollution liability policy in case they were to uncover a source of contamination when clearing a contaminated site. Oil companies, or any company that deals with the transportation of oil, gas, or materials that could cause potential contamination, should have pollution liability.

What Does it Cover?
Pollution liability insurance generally covers any third parties that are harmed by a release of a toxic substance. It could also cover property damage due to a spill of oil or gasoline. It could even cover potential legal fees if a contractor faces a lawsuit for pollution related accidents, or the costs involved for a cleanup. 

The cost of pollution liability insurance varies, depending on the company, potential liabilities associated with the company, and the level of coverage. However, the cost of insurance is considerably less than potential expenses incurred with a single lawsuit, or the costs and liability associated with a potential spill.

<>Be sure to check with a Texas Energy Insurance agent today, to find a policy that covers your company. Pollution and environmental disasters are always unexpected and can be devastating. In case of an accident, pollution liability can save you from the potential flood of lawsuits and the costs incurred, as well as the major expenses of cleanup from contamination.