Environmental Insurance

Recently introduced legislation and gaps in commercial insurance mean companies may not be as protected as they think against environmental damage claims. The Environmental Damage Regulations introduced in 2009 mean that an offending company is no required to clean up the pollution caused and are also expected to return the site to its original condition.

Many commercial policies will exclude environmental pollution which can cause confusion and uncertainty. Many companies do not realise that their public liability insurance does not provide all the insurance protection they need for environmental damage claims and that a specific policy is needed, leaving them open for potential expensive costs and fines.

In 2008, the Environment Agency successfully brought 722 cases against companies and individuals for environmental offences, resulting in fines and costs of £5.3 million. The average fine against companies in 2008 was £10,080 – up from £8,229 the previous year – evidence that the courts are recognising the growing seriousness of incidents which cause the most damage to the environment*. Fines in many cases may be small; however clean-up costs are often very large.

CLA Insurance Services can provide specific Environmental Insurance policies which will help to protect businesses in fundamental areas should an environmental incident occur and should cover key areas such as:

Coverage for gradual as well as sudden and accidental pollution
Coverage for historic and future pollution incidents resulting from on-site event
On and off-site clean-up of pollution conditions
Indemnity for directors and employees

Source: Environment Agency