Offered on a claims-made or occurrence basis, Contractors Pollution Liability (CPL) is a contractor-based policy that provides third-party coverage for bodily injury, property damage, defense, cleanup, and related defense costs as a result of pollution conditions (sudden/accidental or gradual) that result from contracting operations performed by or on behalf of the contractor. Any type of contractor performing operations or conducting work – from environmental or remedial contractors to general and specialty trades – should have CPL coverage as part of their risk management program to protect against large or even catastrophic losses.
You can offer your insureds coverage on a project or blanket program basis. Project policies provide coverage for all operations performed by the insured during the construction period and can include "tail" coverage (extended reporting period (ERP) for claims-made policies and completed operations for occurrence policies) to address the statutes of repose in many states or other contractual requirements. Usually, a maximum term of 12 to 13 years is offered. A blanket program provides coverage on an annual basis for all defined covered operations taking place during the policy term.
According to IRMI, the CPL insurance market in 2017 was made up of about 20 to 25% of the entire environmental space, which remains somewhere from $1.5 billion to $2 billion in premium. About 40 insurers offer various forms of CPL coverage that span 50 to 60 different products, with unique carrier forms and vastly different endorsements, definitions, exclusions, etc. This makes it critical to work with a carrier whose product will be well suited to your insured and to thoroughly understand the coverage you’re securing.
RPS provides CPL insurance with a broad definition of pollutants, which includes fungus, legionnaire’s mold, EIFS, asbestos, lead and silica, as well as comprehensive definition of bodily injury. Included in the coverage are emergency expenses incurred as a result of responding to environmental damage from the insured’s work and PR costs that cover a crisis management consultant to assist with managing the media and minimizing the economic harm caused by a pollution event.
You can review the various options available with our CPL coverage on our online portal as well as quote and bind coverage. To gain insight into the type of risks various contractors face and the resulting costs, we have also provided a wide range of claims examples for you to review with your clients, bringing the risks close to home. If you’d like additional information, please call one of our RPS professionals.