Protect Your Business From Environmental Losses

The liabilities associated with environmental health and safety exposures can devastate your business. The consequences of environmental exposures can range from costly and time-consuming business interruption to bodily injury and/or property damage lawsuits. Because pollution losses are low-frequency, high severity events, your bottom line will be severely compromised if you don’t have adequate protection.

Protect your business. Be aware of your environmental exposures and how XL Insurance can help you effectively manage your risk and protect your bottom line.

Common Environmental Exposures For Demolition Contractors

Demolition contractors – through their operations, owned premises, transportation and disposal practices – face a number of environmental exposures that could be devastating to profitable business:

Operational Exposures

• Fumes, emissions, such as dust, and spills from chemicals (volatile organic compounds) used during renovation/demolition activities
• Disturbance of asbestos-containing materials, including naturally-occurring asbestos
• Disturbance of lead-containing paint
• Lubricant oils and other fluids from equipment
• Release of oils/fuels as a result of vandalism
• Site demolition/excavation work through pre-existing contaminated soil (e.g., unknown residual contamination such as petroleum contamination from leaking underground tanks)
• Impacting underground utility lines and other underground structures
• Silica exposure

Owned Premises Exposures

• Leaking underground/aboveground storage tanks
• Residual contamination from minor spills of oils, fuel, lubricants, etc., and poor housekeeping
• Surface contamination from fuels and lubricants stored improperly (without secondary containment)
• Improper disposal of waste materials
• Unidentified, pre-existing contamination from past owners of the premises

Transportation Exposures

• Inadvertent transport and subsequent disposal of unknown contaminated soil
• Spills of contents (e.g., fuel, lubricants, etc.) during transport
• Resulting pollution from collisions with various structures (e.g., pole mounted transformers, aboveground tanks, etc.)
• Fuel/oil spills/leaks from vandalism

Disposal Exposures

• Inappropriate disposal of products
• Misdelivery of unidentified contaminated fill
• Retroactive liability under Superfund for past disposal practices (i.e., construction debris in a landfill that is now on the Superfund list)

This list is intended only to outline some typical environmental exposures common to demolition contractors and is not all-encompassing.

The Consequences Can Be Enormous

If left unprotected from these exposures, demolition contractors could face:

• Cleanup costs
• Business interruption
• Third-party bodily injury and property damage claims
• Legal defense expense in lengthy litigation trials
• Loss of competitive edge and/or community image

Fortunately, There’s Integrated Coverage You Can Count On From XL Insurance

XL Insurance provides the unique advantage of a complete risk management program in one package. Insurance is combined with risk control programs specially designed for your industry as well as expert claims management to help minimize the impact of claims on your business operations.

Insurance Coverage

XL Insurance provides insurance protection for demolition contractors with a custom-tailored program that includes:

• pollution coverages
• professional coverages
• integrated risk control

Benefits of THE insurance coverage COMPONENT

• Protects your bottom line
• Provides superior form of risk transfer
• Helps meet contract requirements
• Provides financial stability for low-frequency, high severity pollution claims
• Pollution coverages protect against the financial and operational losses associated with environmental liability, including:
  • business interruption
  • cleanup costs
  • third-party bodily injury and property damage claims
  • legal defense expense

Benefits of one carrier for your complete risk transfer package:

• Avoids confusion and potential gaps in coverage between General Liability and Pollution policies
• One underwriter to oversee your entire program ensures better all-around protection

Risk Control

XL Risk Control expertise is available as part of an integrated program, at no additional cost to the insured. Key risk control programs developed for the construction industry include:

Construction Environmental Training (CET) — voted one of the top risk management services by Risk & Insurance magazine

• Mock OSHA audits
• Spill response, loss prevention and health & safety training
• 10-hour OSHA construction outreach training
• HAZWOPER training
• Contract review services
• Written environmental, heath & safety (EHS) programs and/or review of existing EHS programs
• Transportation safety services
• Reference manuals
• Benefits of the risk control component
• Helps minimize losses and protect profitability through a variety of customized training, audits and services
• Helps you identify, prioritize and address your exposures
• Helps meet state and federal regulatory standards to avoid fines
• Assists you in achieving your annual training requirements, to comply with 29 CFR1910.20
• Frees staff to handle other duties
• As part of XL Environmental, you save money versus hiring outside consultants

Claims Management

XL Environmental Claims Administrators’ staff of consultants, attorneys and claims adjusters are just one call away, 24-hours a day, 365 days a year to help manage an incident and minimize the claim, achieving resolution so your business can carry on.

Benefits of the claims management component:

• Provides expert legal advice to help limit financial and legal liabilities arising from environmental, health and safety incidents
• Control emergency response and litigation costs
• Minimum interruption of project activities
• Qualified negotiations with regulatory, federal, state and local agencies, and the media to present your company in a professional, responsive manner
• Reports and updates to keep you informed
• Timely response helps minimize the extent of an incident, lowering impact to the environment and cleanup costs, as well as to your bottom line

It Could Happen To You

Inadequate Ventilation

A demolition contractor was performing rip out work for an elementary school renovation project. During the course of work, dust from concrete cutting set off the fire alarms for the week-long operation. Parents of the students filed a claim against the demolition contractor for fear of contracting silicosis due to inadequate ventilation of the construction zone.

Dust & Fumes Result In Evacuation

A demolition contractor was hired to dismantle a bank vault located in a multi-tenant building. The contractor used torches to remove the bank vault. As a result of the demolition work, a medical clinic located on the floor above the bank vault had to be evacuated due to dust and fumes emanating from the ventilation system. Claims were filed for bodily injury, property damage and business interruption totaling over $95,000.

Equipment Emissions Cause Illness

A demolition contractor was dismantling a building and sent painted structural steel to a local junkyard for disposal. The contractor was subsequently notified that the steel was coated with lead paint. Workers at the junkyard were claiming fear of neurological disorders as a result of inhaling lead during torch work to cut the steel. The junkyard employees did not wear respiratory protection.

Dust Clogs HVAC System

A demolition contractor was removing lead-based paint from a commercial building. Though the contractor isolated the work areas with containment, the HVAC system was not disconnected. The dust from lead removal clogged the heating coils of the building’s HVAC system. The contractor was liable for replacing the HVAC system and the associated disruption of business in the building. Claims totaled $550,000.

Asbestos Release

A demolition contractor performing tear out work for a building renovation unknowingly removed materials containing asbestos. The Environmental Protection Agency deemed that an emergency response to the release was necessary. A work stoppage was implemented until removal, handling and disposal of the asbestos were completed. Disposal costs for the materials exceed $100,000.

The examples above are intended to illustrate the wide variety of environmental exposures faced by demolition contractors and the many ways in which those exposures can arise. Insurance coverage in any particular case will depend upon the type of policy in effect, the terms, conditions and exclusions in any such policy and the facts of each unique situation. No representation is made that any specific insurance coverage would apply in the above examples. Please refer to the individual policy forms for specific coverage details.