{"id":2681,"date":"2022-05-10T21:03:01","date_gmt":"2022-05-10T21:03:01","guid":{"rendered":"http:\/\/estrategist.com\/website\/members\/?p=2681"},"modified":"2022-05-10T21:03:01","modified_gmt":"2022-05-10T21:03:01","slug":"directional-drilling-contractors","status":"publish","type":"post","link":"https:\/\/estrategist.com\/members\/directional-drilling-contractors\/","title":{"rendered":"Directional Drilling Contractors"},"content":{"rendered":"

What is a Pollutant?\u00a0<\/strong><\/p>\n

Any material, substance, liquid, product, etc\u2026 which is introduced into an environment for other than its intended use \/ purpose. Fresh water, cheese, and milk have all been classified as pollutants by Insurance Carriers under various circumstances. What pollutants are impacting your business?<\/span><\/p>\n

Environmental Exposures Impacting Directional Drilling Contractors\u00a0\u00a0\u00a0<\/strong><\/p>\n

Storm water runoff;\u00a0 completed operations exposures including incomplete line hookup or improper system construction causing spills or emissions;\u00a0 lubricant oils and other fluids from field equipment;\u00a0 release of oils \/ fuels as a result of vandalism;\u00a0 site preparation \/ excavation work through preexisting unknown contaminated soil;\u00a0 air emissions from Silica, dust and debris; impacting abandoned underground storage tank; spreading of unknown preexisting contaminated soil as fill;\u00a0 impacting groundwater from drilling and excavation work (i.e. cross contamination of aquifers, etc.);\u00a0 impacting underground utilities and other underground structures; \u00a0 releases from portable storage tanks;\u00a0 natural resource damages;\u00a0 vapor intrusion, PFAS chemicals\u2026.\u00a0<\/span><\/p>\n

Environmental Loss Examples<\/strong><\/p>\n

    \n
  1. While putting in a pilot hole for new utilities in a commercial area, a directional drilling contractor ruptured an unmarked natural gas line. Before the gas line was shut off, hundreds of gallons were released into the soil. Due to safety concerns, local authorities ordered the evacuation within a 2-block radius, which interrupted the operations of nearby businesses. As a result of the accident, 3<\/span>rd<\/span> party business interruption claims totaled over $400,000, remediation expenses totaled roughly $100,000, and the contractor experienced additional losses due to project delays.\u00a0\u00a0<\/span><\/li>\n
  2. A municipality hired a directional drilling contractor to assist in the installation of a new network of data and voice cables. The job included horizontal drilling under several roads. While drilling, the contractor hit a fuel line and did not report it. More than two years later nearby residents began to smell gas in their well water. During investigation, the damaged fuel line was discovered and was determined to be the source of contamination. The local municipality filed suit against the contractor for 3<\/span>rd<\/span> party claims and cleanup expenses totaling over $2.7 million. The insured also accumulated additional legal expenses and was eventually forced out of business due to the loss.\u00a0<\/span><\/li>\n
  3. The concrete secondary containment of a 5,000-gallon gasoline aboveground storage tank located at a drilling contractor\u2019s main office and yard was cracked when it was struck by a piece of equipment.\u00a0 The incident was not reported and at a later date, a release from the tank spilled 3,000 gallons into the containment. The gasoline seeped into the underlying soils and required costly excavation and removal. The total cost for investigation and remediation exceeded $180,000.\u00a0\u00a0<\/span><\/li>\n
  4. A directional drilling contractor was drilling a new utility channel. The drill passed through and exacerbated a preexisting-unknown pollution condition that had been contained by the clay. The drill allowed contaminants to spread into the surrounding soils. Remediation expenses totaled over $150,000.<\/span><\/li>\n
  5. 6-months after completing the drilling and installation of a pipe carrying natural gas, pressure in the pipe began to decline. After further inspection, it was found that a leak in the pipe was allowing natural gas to spread into the surrounding soils. The owner of the property filed suit against both the general contractor and the drilling contractor. Even though the drilling contractor was not held liable for the loss, they still accumulated over $50,000 in legal expenses fighting the claim.\u00a0\u00a0<\/span><\/li>\n
  6. A trenchless boring contractor was installing a new pipe through a layer of clay that contained unknown contaminants. While the clay was staged on the job site, heavy rains started, which allowed the contaminants in the clay to migrate offsite.\u00a0 EPA fines and remediation expenses were in excess of $250,000.\u00a0<\/span><\/li>\n
  7. A drilling contractor caused a release of raw sewage in both soil and groundwater after failing to identify a sewer line before drilling.\u00a0 The cleanup entailed the excavation of several tons of soil ad caused nearby businesses to be shut down for a few days when their basements filled with raw sewage.\u00a0 Substantial claims were filed for business interruption and cleanup costs.<\/span><\/li>\n<\/ol>\n

    Overlooked Benefits of Environmental Liability Insurance<\/strong><\/p>\n

    Because environmental losses are a severity risk, rather than a frequency risk, the majority of directional drilling contractors lack the financial strength to self-insure their potential environmental liabilities. Since every directional drilling contractor has notable environmental exposures, consideration to the economies of scale afforded with environmental liability insurance as part of your risk transfer strategy, versus self-insuring.\u00a0<\/span><\/p>\n

    Furthermore, most commercial insureds only consider the remediation costs associated with a pollution event. However, often the clean-up costs are far less than other costs that often arise from the loss.\u00a0<\/span><\/p>\n

    Overlooked Benefits<\/b> environmental liability insurance offers:\u00a0\u00a0<\/span><\/p>\n

      \n
    1. Defense Costs:<\/b>\u00a0 Environmental liabilities are relatively new and very litigious.\u00a0 Even if you do nothing wrong you can still get named in a suit and have to expense defense costs i.e. legal fees, environmental investigations\u00a0<\/span><\/li>\n
    2. Claim Management:<\/b>\u00a0 All policies come with specialists to assist you in handling a claim.\u00a0 Who is in charge of communications, public relations, emergency response, government compliance, financial management, third party claims for bodily injury, property damage, natural resource damages\u2026.?<\/span><\/li>\n
    3. Third Party Liability<\/b>:\u00a0 The majority of the time the cost to clean up the environmental problem\/s is far less than the associated claims that come in from third parties for bodily injury, property damage and business interruption.\u00a0 You need to look at your client\u2019s and neighbors that can be impacted if you or a sub-contractor\/vendor create an environmental loss.<\/span><\/li>\n<\/ol>\n

      Environmental Liability Insurance Coverages<\/span><\/h3>\n

      Contractors Pollution Liability (CPL)<\/b><\/p>\n

      Standard contractors (i.e. general contractors, HVAC, plumbing, electrical, mechanical, janitorial, demolition, drilling, excavation, highway, street and paving contractors, rigging, utility, millwrights, artisan, etc.), in performing their services may cause an environmental liability that is generally excluded from their general liability coverage. For these contractors there is contingent contractor\u2019s pollution liability (CCPL) coverage. Basically they are afforded the same coverage as remedial contractors but the cost to purchase this insurance is substantially less.\u00a0<\/span><\/p>\n

      Transportation Pollution Liability\u00a0<\/b><\/p>\n

      Generally, Business Auto or Truckers policies will exclude pollution losses arising from spills or other releases of their cargo. Transportation pollution liability affords coverage during the loading, unloading and transportation, for a spill, release or sudden upset and overturn of transported cargo.\u00a0\u00a0<\/span><\/p>\n

      Underground and Above Ground Storage Tanks<\/b><\/p>\n

      Financial responsibility requirements ensure that owners and operators of underground storage tank systems can financially handle a release from an underground storage tank. The responsibility encompasses the ability to pay funds for corrective action and third-party bodily injury and property damage from non-sudden and sudden and accidental releases from a regulated underground system.\u00a0\u00a0<\/span><\/p>\n

      Environmental Impairment Liability (EIL)\u00a0<\/b><\/p>\n

      EIL is for environmental service providers that own, rent, lease, operate or have any other insurable interest in real property (a fixed site facility such as a service garage and shop, transfer\/recycling facility, landfill\u2026.) that can be susceptible to pollution liabilities that actually or allegedly originated from the insured property.\u00a0<\/span><\/p>\n

      Coverage can include: Pre-existing unknown pollution, new pollution conditions, first party on-site clean up, third party bodily injury, property damage, business interruption and extra expense, off site cleanup costs, legal defense expenses, transportation pollution liability, offsite disposal coverage\u2026.\u00a0 Multi year term policies can be negotiated.\u00a0<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"

      Environmental impacts include completed operations exposures including incomplete line hookup or improper system construction causing spills or emissions, spreading or transport of unknown contaminated soil and more.<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_exactmetrics_skip_tracking":false,"_exactmetrics_sitenote_active":false,"_exactmetrics_sitenote_note":"","_exactmetrics_sitenote_category":0,"footnotes":""},"categories":[5],"tags":[92,395,58],"class_list":["post-2681","post","type-post","status-publish","format-standard","hentry","category-risk","tag-contractors","tag-drilling","tag-oil-and-gas","entry"],"_links":{"self":[{"href":"https:\/\/estrategist.com\/members\/wp-json\/wp\/v2\/posts\/2681","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/estrategist.com\/members\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/estrategist.com\/members\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/estrategist.com\/members\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/estrategist.com\/members\/wp-json\/wp\/v2\/comments?post=2681"}],"version-history":[{"count":1,"href":"https:\/\/estrategist.com\/members\/wp-json\/wp\/v2\/posts\/2681\/revisions"}],"predecessor-version":[{"id":2682,"href":"https:\/\/estrategist.com\/members\/wp-json\/wp\/v2\/posts\/2681\/revisions\/2682"}],"wp:attachment":[{"href":"https:\/\/estrategist.com\/members\/wp-json\/wp\/v2\/media?parent=2681"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/estrategist.com\/members\/wp-json\/wp\/v2\/categories?post=2681"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/estrategist.com\/members\/wp-json\/wp\/v2\/tags?post=2681"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}