“Pollution is a very broad term” said Jodie Hallyburton, casualty and pollution underwriter, South Western Insurance Group Limited. “It’s gas, liquid, smoke, heat, light, and even noise. Basically, contamination of the natural environment. With the rapid change in regulations at both the Federal and Provincial levels, pollution liability insurance is becoming a must have for contractors now.”
Although most of these contractors choose a blanket annual policy, not all contractors need coverage for their day-to-day business. Sometimes a single project will expose the insured to unusual liability. This is where a project-specific policy can be the right fit for the contractor.
“For contractors to bid on a project, they need the insurance in place, so they often come to us because of a bid,” Hallyburton said. “That’s usually how they start into pollution insurance, with project-specific insurance.”
Contractors may also discover suddenly they need a policy because of unexpected developments within an existing contract.
“A company that does demolition may find some asbestos in their work,” said Ulli Garrett, casualty and pollution underwriter, South Western Insurance Group Limited. “They’re licensed to take care of it, but this is perhaps a once-a-year occurrence.”
Demolition is only one of the possible scenarios that may require short-term coverage. Some others include:
- Mine construction and closure
- Building construction
- Asbestos and mold abatement
- Road and bridge construction
“Contractors involved in the construction of roads and bridges remove aggregate in the course of their construction operation,” Garrett said. “For that amount of time, they need pollution coverage in case there is anything in the aggregate that is a pollutant.”
They will be covered for the removal, the transport, and the proper disposal of the polluted aggregate under a project-specific policy.
“The company may be transporting polluted cargo to a landfill and have a traffic accident,” Garrett said. “The material may fall into a lake or pond, and perhaps some wildlife would be affected by that accident.”
This type of emergency response and natural resource damage would be covered as well as legal defense costs, and civil fines and penalties.
“Emergency response coverage will allow you to react immediately to mitigate the loss if you see pollution happening,” Hallyburton said.
Project-specific environmental policies can be written for time periods from a month to three years, depending on the needs of the insured.
“With a three year requirement,” Garrett said, “most companies find it is better to have blanket coverage instead of specific coverage as the policy will cover any smaller jobs that are done in between.”
South Western Group is in a position to cover contractors with their project-specific needs.
“We have an excellent market for pollution coverage, and we concentrate especially on the contractor’s side,” Hallyburton said.