The United States’ relative wealth, stability, and broad access to television and the internet have enabled the public to stay informed of growing environmental concerns and provided people with the resources to advocate for change efficiently, creating a mainstream “green movement.” Gen Z has proven to be a highly environmentally conscientious generation. They prioritize working at green companies, buying sustainable products, and investing in responsible corporations. All ages have access to social media, documentaries, and news to make informed buying decisions and ask representatives to pressure businesses to do more to protect the environment. Companies are being held responsible for environmental accidents and pollution arising from standard operation.
Social media has enabled watch groups to more easily publicize environmental infractions and rally citizens to protest and boycott companies responsible for pollution. Documentaries make a passionate case for action. Public pressure motivates municipal, state, and federal governments to enforce and increase environmental regulations. Not surprisingly, there are more lawsuits to hold alleged polluters accountable and higher penalties, including restoring the natural environment’s biodiversity.
For example, the New Jersey Department of Environmental Protection filed suit in early August 2022 against Monsanto, claiming the chemical giant knew that PCB contamination of the Delaware River was harmful to humans and animals. The civil suit seeks unspecified damages. In the spring of 2022, the Securities and Exchange Commission (SEC) announced that companies will be required to release information about their greenhouse-gas pollution and how they will minimize climate risk exposure in the following fiscal year.
Companies strive to deliver sustainable goods and services while minimizing emissions and the risk of environmental accidents. However, as businesses continue to face higher environmental standards—and penalties for creating environmental damage—securing adequate Pollution Liability coverage is essential. Pollution coverage, often referred to as Environmental Impairment Liability insurance, is a specialized insurance policy that explicitly covers third party liability for pollution releases, associated cleanup costs, and in some cases, legal defense.
Acquiring Pollution insurance coverage is an essential consideration:
- Costs for environmental cleanup can be immense, sometimes triggering bankruptcy.
- It’s better for the environment when businesses are financially capable of cleaning up the environmental damage or contamination they cause.
- Relying on a General Liability policy with Pollution coverage may not be enough—they often narrowly define a “pollution event” and have exclusions, limits, and narrow time windows. In contrast, Pollution coverage is designed specifically to fill these gaps and pay to clean up the mess.
- A company accused of alleged environmental damage can receive funds for legal representation. Even a company cleared of all accusations can incur significant legal fees, and without coverage there is typically no defense from the insurance carrier
- Acquiring Pollution Insurance shows a commitment to environmental protection and the future of the enterprise.
- Pollution Insurance companies often work with clients to keep them informed and compliant reducing the risk of environmental damage.
If you are an insurance agent looking for Pollution insurance options from quality carriers for your clients, we can help. Contact the environmental insurance specialists at Beacon Hill Associates. We’ve provided environmental liability insurance for over 30 years.