Understanding Key Environmental Insurance Terms

By Amanda Duncan
Senior Vice President & Manager of Beacon Hill’s Underwriting Division

Have you ever read an article pertaining to environmental issues, or perhaps looked through an environmental report and noticed the same acronyms appearing over and over again? Or you are reviewing questions from your underwriter which include technical jargon you don’t encounter on a daily basis? Is your insured looking to you for help because they now need to comply with environmental regulations?  Below are essential phrases and abbreviations to help better explain the colorful world of environmental topics:

ACRONYMS:

RCRA – Resource Conservation and Recovery Act
CERCLA (aka Superfund) – Comprehensive Environmental Response, Compensation and Liability Act
TSD – Treatment, Storage, and Disposal facilities
SWMU – Solid Waste Management Units
TCLP – Toxicity Characteristics Leaching Procedure
VOC – Volatile Organic Compound
PCBs – Polychlorinated Biphenyls
PRP – Potentially Responsible Party
POTW – Publicly Owned Treatment Works
BOD – Biochemical Oxygen Demand
NPDES – National Pollution Discharge Elimination System
HSWA – Hazardous and Solid Waste Amendments
EPA – Environmental Protection Agency
NODs – Non Owned Disposal sites
WWTP – Wastewater Treatment Plant
NPL – National Priorities List
SARA – Superfund Amendments and Reauthorization Act
CWA – Clean Water Act
TSCA – Toxic Substances Control Act
MCLs – Maximum Contaminant Levels

DEFINITIONS:

Hazardous Waste – Wastes (solids, sludges, liquids, and containerized gases) other than radioactive (and infectious) wastes which, by reason of their chemical activity or toxic, explosive, corrosive, or other characteristics, cause danger or likely will cause danger to health or the environment, whether alone or when coming into contact with other waste.

Large Quantity Generators – facilities which generate over 1000 kg of waste per month.

Small Quantity Generators – facilities which generate less than 1000 kg of waste per month.

Solid Waste – garbage, refuse, sludge from waste treatment plant, water supply treatment plant, or air pollution control facility and other discarded material, including solid, liquid, semi-solid, or contained gaseous material resulting from industrial, commercial, mining, and agricultural operations and from community activities.

Potentially Responsible Parties – present and/or past owners, operators, generators, and transporters of contaminated sites.

Treatment facility – a facility which changes the physical or chemical characteristics of a waste, or degrades or destroys waste constituents, using any of a wide variety of physical, chemical, thermal, or biological methods.

Environmental monitoring – collecting samples of the environmental media and testing for the presence of hazardous substances that may have been released into the atmosphere.

Regulatory compliance – environmental regulations enforced by government entities to manage waste.

Leachate – combination of the direct precipitation infiltration and any liquids squeezed out as a result of consolidation of landfill waste materials.

Landfill – permanent placement of waste on or below land surface.

Fracking – a slang term for hydraulic fracturing. Fracking refers to the procedure of creating fractures in rocks and rock formations by injecting fluid into cracks to force them further open.
Carbon footprint – the total set of greenhouse gas emissions caused by an organization, event, product, or person.
Wetland mitigation – the replacement of wetland functions through the creation or restoration of wetlands.

As environmental coverages become more widely understood and companies are more aware of their environmental exposures, agents will receive more requests for environmental insurance. Having a higher comfort level with industry terms such as the ones included in our glossary above will allow you to more helpfully advise your current clients, and to also take advantage of potential opportunities to work with new classes of business.

Don’t see the term you are looking for? Visit our glossary or contact us today.