go to rather extreme lengths in attempting to avoid claims arising
from hazardous materials or contaminants, due to judges' fondness
for finding insurance where none was ever intended or expected.
(These interpretations have financially impacted insurers perhaps
more catastrophically than any other development in recent history.)
has led to exclusions which attempt to anticipate every possible
legal argument for covering pollution events. Policies may now contain
language voiding insurance and defense for claims arising from fumes,
irritants, waste or contaminants in any form, whether solid, liquid,
or gaseous. Earlier generations of the exclusion made exceptions
for certain "sudden and accidental discharge," however
the legal machinery soon turned those against insurers in one way
or another, and they were largely eliminated.
unintended consequences of these measures have at times meant surprising
denials of insurance. These were situations where the insured's
operations and exposures clearly did not ordinarily involve any
material which would be considered a pollutant. Common materials
such as equipment lubricants, finishes, cleaners, fuels, liquid
supplies and the like, even in very small quantities, can now void
insurance in costly claim scenarios.
uninsured catastrophe can occur when you purchase or occupy property
which has been previously polluted by as yet undiscovered material.
Businesses have unknowingly assumed enormous liability in innocently
occupying environmentally-impaired property. This means careful
scrutiny of previous tenants before utilizing any property is a
to the predisposition of courts to find coverage for pollution events,
underwriters generally avoid business where the exclusion is likely
to come into play, or they apply heavy premium surcharges to offset
the risk. This likelihood also means that if your claim is denied
on the basis of a pollution or environmental impairment exclusion,
there may be counter arguments available to you.