Welder wearing hat and gloves

Environmental Insurance for Welding Businesses

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The environmental exposures for a welding supply and distribution business are varied. They can come from the insured’s owned or leased premises, their products manufacturing & distribution operations, as well as transportation and disposal activities.

Welding pollution exposures include, but are not limited to:

Handling and storing compressed gasses

Generally the concern with these insureds is over the risk of explosion from mishandling or over­pressurization. From a pollution perspective, the exposures may involve the environmental impact after an explosion occurs, including ignition of materials that release toxic fumes when they burn, natural resource damages, bodily injury, and the chemicals in firefighting foam used to extinguish any fire that occurs. Mishandling or the erroneous delivery of these products may also cause a release, as well as tank leaks resulting from problems with temperature or corrosion. Lastly, releases may occur from the failure of mechanical components such as valves and sensors.

Premises Exposures

All businesses have the potential for pollution problems at their owned or operated premises, especially if they operate and house equipment there and/or store/handle products. Common concerns for businesses dealing with welding equipment and related products may include: gases and fumes released into the air, spills of maintenance lubricants and chemicals, vehicle products being stored/used at the facility, etc. Onsite storage and maintenance of equipment and vehicles can lead to contamination from fuels, oils, and other materials used in the upkeep and operation of the business. Stormwater runoff from the site may be affected by sediment, debris, or chemicals, transporting them to local storm sewers or surface waters.

Transportation Exposures

Cylinders containing welding gases may be inadequately secured resulting in breakages; during loading/unloading operations, cylinder caps may be compromised by improper handling (such as using valve­ protection caps to lift cylinders or bars under valves to pry cylinders loose); and, containers may release chemicals due to not being regularly inspected for cracks or corrosion.

Contracting Operations

While businesses dealing with welding supply and distribution are not often involved in actual contracting operations, there are times when their unloading operations can cross the line. An example might be unloading a truck which involves placing the truck properly on the job site, managing the unloading properly, etc. During these operations, the employees could knock over a skid tank of fuel leading to a pollution loss. Or perhaps their truck could crush underground piping, leading to a pollution release.

Disposal Concerns

If any of the welding products or compressed gas tanks are disposed of on a non­-owned disposal site (NODS) and cause a problem to that facility, the responsibility can fall back on the insured. Potential issues could include spills or leaks in unloading areas of the disposal site (including spills or leaks of waste due to inadequate containment of disposal areas or no secondary containment), open waste containers, introduction of waste at the site in unlined areas, air emissions that include hazardous components exceeding permitted values, etc.

Environmental insurance solutions for welding supply and distribution companies

Site Pollution, Premises Pollution, EIL, PLL

  • Unknown site pollution not discovered during environmental site assessments.
  • Indoor Air Quality related conditions that arise during normal operations.
  • Spills of materials stored at facility or warehouse, including maintenance chemicals.
  • Pollutants coming onto a facility from neighboring properties.
  • Pollution uncovered during development/redevelopment excavation activities.

Transportation Pollution Liability

  • Spills while materials are being loaded/unloaded onto transportation vehicles.
  • Pollution releases while materials (waste or products) are being transported.

Non­-owned Disposal Site Coverage

  • Disposal of waste or materials traced back to the facility.
  • Pollution events caused by materials taken to a disposal facility by the company or their disposal company which could result in third party property damage or bodily injury.
  • The business named as potentially responsible party (PRP) by environmental regulators for the contribution of materials/waste at a disposal site.

Business Interruption

  • Loss of income as a result of pollution.
  • Loss of income as a result of pollution coming onto the  property from adjacent properties.

Storage Tank Coverage

  • Certain underground storage tanks holding petroleum are required to have financial assurance.
  • Releases of raw materials or products from storage tanks affecting soil; or groundwater going off­site and affecting natural resources.

Claims involving welding businesses

  • The owner of an apartment building that was destroyed by a fire sued a welding company, claiming that the welding company was responsible for the blaze. The welding company was accused of failing to not only keep a fire extinguisher at their worksite, but also not placing fire resistant shields or guards over combustible materials in the vicinity of their worksite. The compliant did not specify a sum for the loss, however, the property that was damaged has been valued by the city at over $1,000,000.
  • A multi-million dollar lawsuit was filed against a number of companies that worked on renovating a casino. The suit claimed that a welder sparked a fire in a kitchen where there was greasy residue that led to the spread of flames throughout the building.
  • A welder that was fixing an exhaust pipe for a pizzeria in New York caused a fire when grease in the pipe ignited. Over 100 firefighters responded to this incident and three firefighter’s sustained injuries battling the fire.
  • The estate of a firefighter that died fighting a blaze caused by a welder sued the welding company, its owner, and the owner of the building where the welding work was taking place. The suit alleged that the defendants did not maintain a fire extinguisher or place a fire resistant shield to prevent ignition of combustible construction materials. The suit sought an unspecified amount.

While the coverages we offer are designed to address these general issues, we make no guarantee or warranty that any individual policy we offer will respond to all issues as described herein. Please refer to the actual policy wording in each offered form to determine coverage applicability and acceptability. In the event you apply for coverage and we offer terms, please review those terms carefully to determine if all the exposures are being addressed. In some instances, more than one policy or type of coverage may be necessary.

Type: Blog

Topic: Welding