A renovation or building project does not have to involve contaminated land or an old building structure in order to be subjected to potential environmental claims. Many environmental exposures stem from routine building work and often are not visible until they become costly problems. Carpentry contractors are at risk for a variety of environmental problems as a result of their operations, equipment/products, disposal methods, etc. These are considerations that should be discussed when looking at a carpentry contractor’s insurance program.
Disturbing or exacerbating existing pollutants
Many claims faced by Carpentry contractors stem from disturbing asbestos, lead, or existing mold within the structure while work is being performed. This can take the form of asbestos ceiling or floor tiles, lead paint on windows and doors, or mold growth that existed prior to the work. Making these conditions worse by spreading the contamination can lead to significant liability on the part of the contractor.
Contractors’ operations lead to pollution release
One of the biggest environmental concerns faced by carpentry contractors is the allegation that their work has lead to either a direct release of pollution or to an unhealthy indoor environment. This can stem from damaging pipes, sewer lines, duct work, or electrical lines, as well as from poorly sealed sheathing, window flashing or other weatherproofing. These can manifest themselves in many ways, including pollution releases, dusts, odors, ill employees, or visible staining and damage to walls and fixtures. When these allegations lead to Bodily Injury, Property Damage or Business Interruption, the claims can become sizeable.
Job site pollution caused by contaminants the contractor brought to the site.
Many Carpentry contractors regularly use reactive and toxic adhesives. Finish carpentry is usually followed by application of chemical coatings, including paints, lacquers and stains. Clean-up of any of these operations may be accomplished by use of toxic or combustible solvents. Releases of any of these substances can occur during their use and subsequent cleanup.
The operations of subcontractors for which the contractor is responsible
Often Carpentry Contractors will also act as the General on a project. As the GC, they will hire subcontractors to do work such as mechanical / HVAC, electrical, plumbing or remodeling / construction and they then run the risk of being held responsible for pollution conditions stemming from the work subbed out. Obviously the contractor should require the sub to carry their own insurance, and name the contractor as an additional insured. What often happens, however, is the sub will not carry adequate environmental coverage. If they cause a pollution condition, and their coverage is inadequate, the Carpentry contractor may be in a position of having to defend themselves against claims relating to work for which they were responsible due to their hiring of the sub.
Over the road pollution
Most Carpentry contractors transport glues, solvents and other consumable materials to job sites. Additionally, they may haul away old framing and discarded materials that may contain lead based paint or asbestos. An accident on the highway may lead to expense for clean up and third party losses. Coverage available through the auto policy may be quite limited.
Contractors owned premises exposures
Many Carpentry contractors have significant property used to store and maintain their equipment, vehicles and offices. These facilities can range from simple warehouse space, to those facilities with maintenance bays, bulk fuel storage, etc. Open air storage of bulk consumables such as adhesives, stains etc could be hazardous in severe weather or fire conditions. Additionally rain run off from any treated timber , discarded material consolidated, stored or stockpiled could create a pollution condition. For many contractors, this property represents a significant equity position. Losses from this type of exposure can include cost of cleanup, diminution of property value and third party bodily injury.
Claim Scenarios for Carpentry Contractors
- A carpentry contractor used solvent to remove paint from a residential structure and improperly disposed of the materials on-site. A group of residents filed a $10 million toxic vapor inhalation suit against the contractor, citing bodily injury, trespass of pollutants and adverse effects to their quality of life.
- While performing building renovations, a carpentry contractor used gas powered generators and equipment. The contractor failed to properly vent or contain the emissions from the equipment during operations. Employees working in a nearby area of the building complained of headaches, nausea and respiratory problems. The results of an air quality study concluded that the increased carbon dioxide levels in the building resulted from the construction equipment. The contractor was liable for causing building-related illnesses that resulted in multiple bodily injury claims.
- A carpentry contractor renovated the interior of a residential house built in the 1950s. The renovation involved paint removal from interior walls, window trim and door jambs. During the course of renovation, the contractor used a plastic barrier to seal the areas where he was working. The homeowners continued to occupy the house during renovations. Additionally, the wife was six months pregnant. Renovation was finished prior to the birth of the baby; however, upon birth, the child tested positive for blood lead poisoning. After investigating the source of the lead, the couple sued the contractor for bodily injury as well as potential loss of future wage potential (due to a possible decreased IQ level for the baby).
- Damaging Dust – A subcontractor working for a Carpentry/General contractor performed abrasive sandblasting on a structure. The structure was located near a residential area. Lead paint chips and dust from the sandblasting became airborne and migrated onto residential properties, requiring cleanup. The residents filed property damage claims against the General contractor for the dust generated by the subcontractor. The claims totaled $400,000.
- Contractors Yard – A contractor was using an aboveground storage tank (AST) to store gasoline for his trucks and equipment. One morning, they discovered that vandals had shot a hole in the tank, releasing thousands of gallons of gasoline from the AST. This spill was the subject of a Government-mandated excavation and disposal of the contaminated soils.
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