Author Archives: lci

Above Ground Storage Tanks (AST’s)

From contractors to agriculture, manufacturers, auto dealer and repair facilities, trucking companies, gas stations, Above Ground Storage Tanks (AST’s) are abundant if our business world.

Above-Ground-Storage-TankInitial reactions generally are AST’s make sense versus Underground Storage Tanks (UST’s). In talking with insurance professionals I will hear the insured does not really have an environmental exposure because their raw materials are stored in AST’s with secondary containment. The AST pictured above is in secondary containment. However as you and I am sure the contractor at this job site can see the integrity of the secondary containment has been compromised. It is important to annually test the integrity of an AST’s secondary containment.

More than likely if there is a release from this AST it will breach the secondary containment and allow pollutants to spread. As a side note this tank is located in an area where local residents get their potable water from wells on their property, no city water supplied.

I also point out this picture was taken after hours and there was no lock on the tank that would restrict vandals from stealing fuel or just pumping it on the ground for fun. Regardless, the owner of the tank is responsible if there is a release, even if caused by vandals.
At least this tank was placed in some type of secondary containment. I would say more times than not AST’s are just placed on the ground with no secondary containment. Farmers, like contractors will move AST’s around on their property to conserve fuel. We see claims for this after it rains and the ground the AST was placed on gets saturated and unstable allowing the tanks to tip and spill its contents.

Is an AST’s located where natural disasters (tornados, floods, hurricanes, earthquakes…) occur? Natural disasters can destroy the integrity of the tank releasing its contents?

While AST’s seem to be a better option than UST’s, when a spill does occur, the contents can spread faster and further than with a UST release.

Most states do not require financial assurance on AST’s like they do for regulated UST’s. One benefit to financial assurance is when a loss does occur there are some monies available to address the environmental liability. AST’s can easily be insured on a standalone basis or using a contractors pollution liability policy or a site pollution insurance policy.

If you are a AST owner you need to have not only a risk management strategy to reduce your exposure to loss but a financial assurance strategy for when a release occurs.

As your environmental team member Environmental Risk Managers can assist you in proactively addressing your client’s environmental exposure to storage tanks.

Toxic Release Inventory To Generate New Business

The Toxics Release Inventory (TRI) tracks the management of certain toxic chemicals that may pose a threat to human health and the environment. U.S. facilities must report annually on how much of each chemical is released to the environment and/or managed through recycling, energy recovery and treatment.
In 2014, 21,783 businesses reported their TRI use. 25.45 billion pounds of TRI chemicals were reported as managed as waste: • 37% was recycled • 14% was used for energy recovery • 34% was treated • 16% was disposed of or released
Bottom line: The government tracks TRI chemicals because they are some of the most dangerous chemicals used. Any company that uses TRI chemicals is an excellent candidate for pollution insurance because they have a pollution exposure that is serious enough the government monitors them.

Marketing Strategy

Go to click on view TRI data where you live and it will list for you the names and addresses of companies in your marketing area using TRI chemicals. When you call to strategize on the environmental exposures impacting their operations do not waste their time discussing standard P&C insurance because as we all know they have herd that a 1,000 times. Simply let them know you would like to meet to discuss managing and transferring their environmental exposures. Email to the company the appropriate ERMI environmental Risk Assessment (eRA) for their review so you and the company can get on the same page about the environmental exposures impacting their operations. This strategy will drive sales of not only pollution insurance but your standard P&C products.

ERMI, your team member for all things environmental.

environmental Strategist, between the lines: Vapor intrusion

Vapor intrusion is such a huge environmental exposure for property owners that ASTM the society that developed our Phase I, Phase II… site assessments developed ASTM 2600 that deals specifically with vapor intrusion. If you are a property owner you must have a strategy in place to address your exposure to vapor intrusion. Relying on the at fault party/s to make you whole is a very weak strategy.

Pollution liability insurance can protect property owners from vapor intrusion.

This article offers a nice overview on vapor intrusion: Vapor Intrusion: An Emerging Risk That Could Cost Property Owners (new window)