Source: http://www.grahamco.com, December 7, 2015
By: Shane Riccio, The Graham Company
Property owners often don’t consider pollution legal liability policies, but they should. As evidenced by the recent legionella bacteria that was found in at least several water towers at schools throughout Long Island, and the outbreak this past summer in the Bronx, you don’t need to be engaging in hazardous operations to be confronted with a pollution liability issue.

What is Pollution Legal Liability?

Before you can determine whether or not you need it, you need to understand what a pollution liability policy is. Back in the early 1980s, a general liability policy covered pollution events of all kinds. However, due to the education of the general public on environmental awareness, insurance carriers began to see an uptick in the frequency and severity of pollution claims. As a result, they began to exclude this coverage and developed a pollution-specific coverage form that they started to charge premiums for.
Pollution liability policies originally provided coverage for third-party liability claims alleging bodily injury and property damages for ongoing and completed operations. Today, the coverage is much more robust, offering coverage for clean-up, remediation, defense costs, emergency response, crisis management, transportation, mold, site pollution for contractor projects and professional liability coverage, among others.

Why Pollution Legal Liability is Important

If you’re a building owner hiring a contractor to do work, you want to be named an additional insured on the contractor’s policy. This way you can transfer the risk for any claims from tenants of your building to the contractor’s policy.  However, in some instances, when you can’t transfer risk, having a pollution legal liability policy can be advantageous.
Pollution legal liability policies are comprehensive because they provide first-party and third-party coverage. However, you have to make sure it’s endorsed to include things such as microbial matter and viruses (such as Legionnaires Disease) because sometimes these perils are excluded. This policy will also cover bodily injury to any tenants in your building, and costs to clean up a pollution incident within or emanating from the building. For those in the healthcare and hospitality industries this is especially helpful because it provides coverage for third-party exposures.

Do I Need a Pollution Liability Policy?

You might be wondering if you do or don’t need a pollution liability policy. The answer isn’t the same for every business. Depending on your environment, your industry and a myriad of other factors the answer could be “yes” or “no.” To determine what’s right for you, speak with your insurance broker. They’ll help you analyze your situation and make the right decision.