Chapter 14 Environmental Liability Insurance Flashcards
What type of insurance can be purchased to cover potential liability for removal of asbestos-containing materials?
asbestos abatement liability insurance
What types of insurance policies are written on an occurrence basis (claims can be filed at any time provided the occurrence happened during the policy term)?
Asbestos abatement liability
lead based paint abatement liability
asbestos in place insurance
What twelve types of situations can be covered by Pollution Legal Liability Insurance?
- claims from on-site cleanup of unknown preexisting conditions triggered by discovery or a third-party claim
- Claims for on-site cleanup of new conditions triggered y discovery or a third party claim.
- Third-party claims for personal property damage caused by on-site pollution
- Third-party claims for bodily injury caused by on-site pollution
- Third-party claims for cleanup costs off site, resulting from pre-existing conditions
- Third party claims for cleanup off site regulating from new conditions
- Third-party claims for property damage resulting from on-site conditions
- third party claims for off-site bodily bodily injury resulting from on-site conditions
- third-party claims for off-site bodily injury, property damage, or cleanup costs resulting from conditions originating at a non owned location (insured’s waste causing damage at a landfill)
- third party claims for on-site cleanup costs on, within, or under a non owned location resulting from pollution conditions originating from a non owned condition (Superfund)
- claims resulting from an interruption of the insured’s business due to pollution conditions (insureds business is closed due to someone else’s pollution)
- third-party claims for cleanup costs resulting from the transportation of product or waste
Perfect Remediation, Inc., provides both professional services and the actual physical operations for pollution abatement projects. As a result, the company can combine the contractors’ pollution legal liability coverage on a claims-made basis and its professional liability coverage on a(n) __________ basis.
a. completed operations
b. standalone
c. occurrence
d. claims-made
d. claims-made
Which of the following is not a valid method of obtaining protection against claims of third-party bodily injured and property damage arising from asbestos abatement projects?
a. a standard CGL policy
b. ultra hazardous activities liability insurance
c. stand-alone asbestos abatement liability insurance
d. CPL (contractors pollution legal liability) insurance, without asbestos exclusions
c. stand-alone asbestos abatement liability insurance
What are eight costs that can be anticipated related to pollution/environmental compliance?
- capital expenditures for the best available control technology or waste minimization systems to comply with environmental laws
- environmental expertise, either in-house staff or outsourced
- administration of record-keeping and reporting requirements
- health and safety training programs required under many laws
- raw material and waste disposal expenses
- legal costs
- general business accounting for environmental costs
- costs of evaluating real estate transfer opportunities
All of the following are expenses regularly associated with environmental compliance EXCEPT:
a. health and safety training that is legally mandated
b. disposal of raw materials and waste
c. public relations campaigns
d. legal costs
c. public relations campaigns
What are nine potential sources for environmental hazards potentially found in buildings or on projects?
- building materials containing asbestos
- paint containing lead
- PCBs (polychlorinated biphenyls) in transformers and fluorescent light ballasts
- chemicals emitted by new building materials, finishes, or cleaning materials
- contaminants brought in to the building through the air and trapped inside the building
- unknown but preexisting contamination on, within, or under the property
- pollution resulting from the activities of a third party on the property
- pollution arising from building operations or processes
How can property owners maintain control over large-scale abatement projects and ensure adequate liability limits for contractors?
By instituting an OCEIP (owner-controlled environmental insurance program)
Main advantage is that the owner typically has one insurance policy that insures multiple parties the site
An underwriter needs information about on-site disposal sites. Examples of disposal sites of interest to the underwriter include all of the following EXCEPT:
a. surface impoundments
b. deep well injections
c. closed landfills
d. storm drains
d. storm drains
What data will insurance underwriters and technical experts analyze before underwriting a pollution legal liability policy?
They will review environmental impact statements that evaluated the geographical location of the insured site and its potential to affect surrounding locations;
the quantity of hazardous material stored or used in process on the insured site;
and the physical control measures, such as secondary containment, used on the property.
Loss control surveys are often used:
a. to justify leadership change
b. to identify environmental hazards
c. as an argument against liability
d. as grounds for foreclosing a property
b. to identify environmental hazards
The following are all environmental hazards that are commonly found in commercial buildings EXCEPT:
a. building materials that contain asbestos
b. lead paint
c. residual materials from decomposing plastic and oil
d. contaminants brought in by outside air trapped in the building
c. residual materials from decomposing plastic and oil
With an occurrence policy, a claim:
a. must be reported while the policy is active or occurring.
b. must be reported within two years of the claimant being exposed to the pollutant.
c. can be reported any time after the policy term, so long as the event occurred during the term
d. can be reported for a preexisting condition so long as the claim is made during the policy term
c. can be reported any time after the policy term, so long as the event occurred during the term
Which type of insurance can be purchased to cover potential liability for the asbestos operations and maintenance program?
asbestos-in-place insurance
