By Beth Brooks, Administrative Assistant
Office buildings could potentially have many environmental risks such as mold, asbestos, water leaks, cleaning chemical spills, problems stemming from an HVAC system, a historic event, sewage backups, and much more. These risks can happen at any time and may remain undetected for an extended amount of time, resulting in a large claim.
Mold can occur from a leaky roof, plumbing leaks, improperly installed windows, and even when humidity is not properly controlled by the heating/air conditioning unit. It can spread quickly behind drywall and go undetected. Something as simple as a small leak can result in a large claim. The costs to remediate mold or medically treat people affected by mold can be devastating.
Asbestos is often found in office buildings built prior to the 1970s. Once found and “disturbed,” it can cause a serious health risk to anyone coming into contact with it and must be properly removed by a professional.
Cleaning supplies used in office buildings are another potential pollution exposure. If not stored, used, and disposed of properly, they can cause a serious risk to people if inhaled or touched. There is also a possibility of contamination to the site if a toxic cleaning agent seeps into the ground. Spills may not only affect a property, but neighboring properties may be a risk as well.
Prior to the insured owning or managing the location, the site may have been used for something that caused a prior condition. It may have been a gas station with fluid spills or possibly an unknown underground storage tank; the site may have been used as a manufacturer and chemicals may be found in the soil or groundwater; a previous tenant may have dumped chemicals down the drain, resulting in the removal of the building’s plumbing. The insured may think that there is no cause for concern because they are only focused on the current use. However, they may discover that there is prior damage, not only at their location but also at neighboring locations.
Problems relating to indoor air quality frequently occur in office buildings. Something as simple as having a room painted could create fumes that could make employees sick; a problem with the building’s roof or HVAC unit could create contaminated air; or the building’s carpet may have been manufactured with a substance that causes an allergic reaction. We have seen many of these exposures in claims over the years.
If an insured has a pollution condition and their office must be closed for remediation, their Premises Pollution policy may or may not include Business Interruption coverage. This insurance can help reimburse the client for lost revenues as a result of the pollution event.
Office buildings are in virtually every city in the U.S., so these exposures are very real concerns for many insureds. Take this opportunity to make sure your clients are properly covered. For more information on coverage for office buildings, contact a Beacon Hill Associates representative.
Learn more about site pollution coverage.