EXPERT ADVICE: Coverage for Environmental Losses

EXPERT ADVICE ARE YOU COVERED FOR ENVIRONMENTAL LOSS?

BY ALINA CELLURA

Most manufacturers and distributors do not realize that there is a huge gap in their General Liability (GL) coverage. Losses and claims from a pollution incident or environmental exposures from manufactured products are not covered on the GL policy.

There is a solution for this gap in coverage and some insurance carriers have been offering it: Combined Form General Liability and Environmental coverage.

The Combined Form has many perks if the manufacturer or distributor qualifies for coverage. First and foremost, it offers broader coverage to address significant coverage gaps. It is better priced for catastrophic exposures and is not lumped with retail frequency of “slip and falls.”

Finally, it is non-auditable, which means premiums are based on the previous 12-month revenue and do not vary during the policy term regardless of changes in company sales.

The Combined Form is great solution for manufacturers and distributors concerned about losses from environmental claims and products pollution liability and want to fill this gap in coverage.

Generally, limits for this policy include $1 million per incident with a $2 million aggregate limit on the primary policy, with umbrella limits available up to $300 million. There is a $0 deductible option for casualty claims, including products pollution.

Often, insurance carriers that offer this policy form can write other policy lines and provide aggressive premium options for the insured. Carriers we work with are A.M. Best “A” rated and have many years of environmental insurance experience and writing the Combined Form.

We urge manufacturers and distributors to consider this policy form as it may save in premium costs and future potential losses currently not covered on the standard GL policy.

As noted above, this policy form addresses significant gaps in coverage. Environmental losses are not covered on GL policies. The Combined Form will however cover you for new pollution conditions cleanup and liability, both on and off-site resulting from your operations, as well as products pollution and exposures.

A great example of a products pollution exposure is the common Teflon non-stick pan. Chemicals known as PFAS (per- and polyfluoroalkyl substances) were commonly found in many Teflon and non-stick pans and are known carcinogens.

Thankfully, use of these chemicals has been mostly phased out over time, but many products have other potential unknown environmental exposures that could give off toxic fumes and/or are skin irritants.

Many manufacturing operations also use products that come from abroad where environmental standards are not as stringent. It is the use of these products in your operation that could possibly result in products pollution claims.

The Combined Form covers you for these potential exposures.

Other coverages the Combined Form addresses are pollution liability during transportation and misdelivery, natural resource damages, non-owned disposal site coverage, and off-site contracting operations for pollution.

Liability and cleanup of soil, surface water and groundwater are also covered for mold, asbestos, lead and silica.

This policy also provides many enhancements. Not only does it cover you domestically, but it provides worldwide pollution coverage for products, transportation, off-site contracting operations and non-owned disposal sites. Restora-

Alina Cellura is an account executive in the Environmental and Professional Services Division at SterlingRisk. She has both Bachelor’s and Master’s of Science degrees in Environmental Services and Geology, and has held various positions in the insurance field since the late 1990s. For questions or to explore coverage, please contact Alina Cellura at (516) 773-8636 or acellura@sterlingrisk.com.

tion costs, host liquor liability, professional liability, and contractual liability for work near a railroad are included as well.

The Combined Form offers the broadest “Who is an Insured” language including lessors, vendors, newly acquired or formed, volunteers and leased workers. In addition, there is a blanket Additional Insured coverage when required by contract.

Emergency response costs for immediate mobilization of environmental professionals is provided in the event of a loss. Business Interruption, bioterrorism and intentional releases of chemical, biological and nuclear agents are covered as well.

Finally, the policy will also cover legal and defense costs and expenses. Bottom line, if you qualify, this policy form can fill in gaps of coverage, save in premiums, and offer many perks and enhancements that are not provided in standard GL policies.

Alina Cellura and the Environmental team consult with manufacturing and distribution clients on unique risk management solutions to provide the most economical and comprehensive coverage on a Combined Form for General Liability, Products Pollution Liability, Site Pollution Liability and Contractors Pollution Liability, and coordinate the placement on all other necessary insurance lines. SterlingRisk was founded in 1932 and is one of the top 35 largest privately owned and managed brokerages in the United States, employing about 300 skilled professionals in eight offices, with its principal location in Woodbury, New York.

SURVIVING COVID & CANCER

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work, and as the sole owner and employee, it often meant attending chemotherapy sessions and then going straight back to the store to pack and deliver orders.

However, her customer base grew, and even though stores are now allowed to reopen Adeyemi still offers same-day delivery service in her locale.

Throughout all the challenges of the last few years, Adeyemi’s passion for her business and incredible resolve has kept her going during her cancer treatments and the threat COVID-19 has posed.

She firmly attributes her recovery from chemotherapy and a stem cell transplant to God, her family, and her business. She is a fighter and an inspiration to all.

Adeyemi is now working on starting her own nonprofit organization to assist African Americans living with Multiple Myeloma.

March was Multiple Myeloma Awareness Month and Adey’s Beauty Supply donated a portion of its March sales to the International Myeloma Foundation. The IMF has an initiative to increase awareness about Multiple Myeloma in the African-American community.

MASPETH

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