Most general contractors or construction contractors rely on commercial general liability (CGL) insurance to cover them from third-party claims due to bodily injury or property damage. While CGL policies offer the best overall protection for contractors, there are some gaps and limitations you need to be aware of and one of those is contractors pollution liability (CPL). Standard CGL policies do offer some protection from pollution claims, but you are not fully covered for various environmental losses.
The main reason to consider pollution liability insurance is simply because of the limitations and exclusions that probably exist in your current CGL policy. A common exclusion is called the ‘absolute pollution exclusion’ and an even more restrictive one is the ‘total pollution exclusion’, which can leave you paying for some very costly cleanups. It can be as simple as breaking an oil pipe on a job site causing contamination to the surrounding environment. Your CGL policy would probably only cover the cost of repairing the pipe itself and you’d be left paying for the cost of cleaning up the spill.
If you are involved in renovation work, you face additional pollution risks caused by asbestos and mold. Discovering asbestos is a particular risk when renovating or demolishing older buildings. And thanks to water leaking or seeping into buildings, mold can be growing undetected until renovations reveal them. In either case, if your work disturbs asbestos or mold, both of which are related to serious health issues, you can be facing a very serious claim with little or no protection from your existing CGL policy.
Until excavation actually begins, you never really know what you might find. In spite of the best research and preparation, if you hit an old oil tank that nobody knew was there, you could be held responsible for cleaning up any resulting spill.
In recent decades, all levels of government in Canada have introduced legislation to protect our natural environment. As a result, companies that do not follow these laws can be assessed with fines well in excess of $100,000.
Talk to a commercial insurance expert for a thorough risk assessment and review of your current coverage. Call Sean McNamara today at 1-800-731-2228 or email me at firstname.lastname@example.org. I’d be happy to help you with any commercial insurance questions or concerns.