Contractors Pollution Liability

What is Contractors Pollution Liability?

Contractors Pollution Liability insurance (CPL) is coverage designed to protect from third party claims for damages caused by “Pollution Conditions” arising from the insured’s covered operations. Adding “Mold” coverage broadens the defined list of covered pollutants to include molds, funguses, etc.

The policy provides coverage for Bodily Injury and Property Damage, but only for their operations performed at a jobsite as well as clean up costs at the site. Coverage applies to work done by the insured or on the insured’s behalf and includes defense costs coverage if the insured is involved in a lawsuit.

Depending on optional endorsements selected for a policy, coverage may also apply to 1^st/3^rd party transportation, non-owned disposal sites, temporary on-site storage, mold, punitive damages and terrorism.

Who Buys Contractors Pollution Liability?

Environmental service providers of all shapes and sizes should carry Contractors Pollution Liability and non-environmental trade contractors should also have CPL coverage as part of their insurance plan.

Specific Target Risks May Include:

• General contractors
• Roofers, plumbers, and electricians
• Carpentry contractors
• HVAC/mechanical contractors
• Sewer and septic contractors
• Utility contractors

How Does Contractors Pollution Liability Work?

General insurance policies are designed to cover many of the common exposures insureds face. Environmental insurance coverages are designed to respond to the environmental exposures that may not otherwise be covered by traditional policies. These exposures may include: Disturbing or exacerbating existing pollutants, contractor’s operations lead to pollution release, job site pollution caused by contaminants the contractor brought to the site, the operations of subcontractors for which the contractor is responsible, and over the road pollution.

• Generally designed to address the coverage gap created by the CGL pollution exclusions.
• Policies usually written to provide coverage for operations performed “by or on behalf” of the insured.
• Coverage is provided for the insured’s operations away from their own premises.
• Base policies can be written on either a Claims Made or an Occurrence basis.
• Mold coverage is usually offered as an endorsement to the CPL insurance policy or coverage part.
• Mold is usually on a Claims Made form.
• Mold coverage may have a sub limit of liability, as well as its own deductible.

Optional Coverage Enhancements

Most environmental insurance carriers offer a variety of enhancements to their policies to make the coverage more tailored to the insured’s needs. These enhancements may include:

• Over the Road Pollution for the transportation operations of the insured.
• Temporary storage of contaminants on the insured’s property.
• Loading and unloading of vehicles at the job site.
• Incidental professional.
• Blanket waiver of subrogation, additional insured.
• And many others….

Coverage Cost

Premiums start at $1,000, and limits are available from $500,000/$500,000 to $25,000,000.

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