{"id":2777,"date":"2022-05-16T20:57:47","date_gmt":"2022-05-16T20:57:47","guid":{"rendered":"http:\/\/estrategist.com\/website\/members\/?p=2777"},"modified":"2022-05-16T20:59:29","modified_gmt":"2022-05-16T20:59:29","slug":"port-authorities","status":"publish","type":"post","link":"https:\/\/estrategist.com\/members\/port-authorities\/","title":{"rendered":"Port Authorities"},"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.\u00a0<\/span><\/p>\n

Many contractors assume that claims arising from operations are covered by the general liability policy. However, claims resulting from a \u201cpollution incident\u201d are excluded from most general liability policies, which leaves most contractors exposed to potentially uncovered claims. What pollutants are impacting your business?<\/span><\/p>\n

Environmental Exposures Impacting Port Authorities\u00a0<\/strong><\/p>\n

Include, but are not limited to<\/b>:\u00a0 Spills\/releases during loading\/unloading process;\u00a0 Pollutants being shipped through the port;\u00a0 Illegal \/ midnight dumping of pollutants, fuels, waste from tenants, ships, rail road, over the road transporters, aviation operations\u2026.;\u00a0 Dust & vehicle emissions;\u00a0 Spills from fuels and hazardous materials stored in above ground or underground storage tanks;\u00a0 Pollution from neighboring properties migrating onto Ports (Vapor Intrusion);\u00a0 Tennant operations causing a pollution exposure;\u00a0 Storm water runoff;\u00a0 Loading and unloading of pollutants over unsealed areas;\u00a0 Natural resource damages;\u00a0 Acid wash for boats; Leaks from elevator hydraulic fluid storage tanks; Equipment maintenance services;\u00a0 Corroded wastewater and storm water sewers;\u00a0 Sick building syndrome;\u00a0 Impacting underground utilities on Port property;\u00a0 No auditing of waste handling and disposal companies;\u00a0 Tenants using or storing environmentally sensitive materials, chemicals, waste\u2026.;\u00a0 Obsolete and remote equipment storage (bone) yards where contaminants percolate into the soil\/groundwater;\u00a0 Releases from refrigeration systems;\u00a0 Wastewater treatment plants\/ lift stations\/ pumping stations;\u00a0 Vandalism;\u00a0 Mold; Asbestos;\u00a0 Lead;\u00a0 Past\/present use of septic systems;\u00a0 Adverse reactions and interactions of chemical compounds that accidentally commingle during a fire;\u00a0 Janitorial cleaning compounds;\u00a0 No emergency and spill control plans;\u00a0 nuisance odors;\u00a0 Storage and use of pesticides and herbicides;\u00a0 Transfer and recycling facilities;\u00a0 Painting and sanding; De-icing operations;\u00a0 Brownfield\u2019s\u2026.\u00a0 Some Port\u2019s also have golf courses, airports\u2026. that create a variety of environmental exposures.<\/span><\/p>\n

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

    \n
  1. A chemical storage area sparked a fire that forced the evacuation of neighboring businesses.\u00a0 Businesses and residents within a two mile radius had to evacuate because of fumes from the chemical fire.\u00a0 Local residents from miles away could hear the ‘popping sound’ of the 55-gallon chemical drums as they exploded. The hazardous nature of the chemicals, and the fumes created by the fire, necessitated the evacuation of more than 20 businesses.\u00a0 Businesses remained barred from their facilities for several days while the fire was extinguished and chemicals were cleaned-up.\u00a0 The Port was sued by several business and third parties for business interruption as well as property damage, clean up costs and third-party bodily injury.\u00a0 Costs to settle the claims exceeded $30,000,000.<\/span><\/li>\n
  2. A new building was built on the site of a former equipment storage area.\u00a0 During excavation, petroleum hydrocarbon contamination was discovered.\u00a0 Cleanup costs exceeded $400,000.<\/span><\/li>\n
  3. A Port owned several parcels of vacant land.\u00a0 When the Port visited the site to begin construction of a new building they discovered that several piles of unidentified waste had been illegally dumped on the property. The Port had the piles tested and test results showed the piles contained hazardous waste.\u00a0 Cost for the Port to dispose of the waste exceeded $650,000.<\/span><\/li>\n
  4. A Port acquired property previously used for manufacturing.\u00a0 The port planed to expand their warehousing operations.\u00a0 When excavation began an abandoned on site lagoon waste treatment lagoon was discovered.\u00a0 The soil and had to be removed at the Ports expense.\u00a0 Remediation and disposal costs exceeded $750,000.<\/span><\/li>\n
  5. An excavation\/grading contractor unknowingly spread petroleum-contaminated soil across a project site during fill operations.\u00a0 The contractor and Port were named in a lawsuit for exacerbating the extent of contamination.\u00a0 After lengthy deliberations, the contractor and Port were eventually removed from the lawsuit, however, they had invested $150,000 in defense.<\/span><\/li>\n
  6. An excavation contractor was subject to cleanup costs and business interruption expenses in excess of $500,000 when they ruptured and unmarked petroleum pipeline.\u00a0 The contractor was forced out of business so the property owner a Port had to pay the bill.<\/span><\/li>\n
  7. A HVAC contractor was hired to upgrade an office buildings heating system. While working in the building, the contractor failed to vent the system properly, causing a release of carbon monoxide.\u00a0 Building occupants complaining of headaches and nausea were rushed to the local hospital.\u00a0 As a result, several bodily injury suits were filed against the building owner in excess of $1,000,000.<\/span><\/li>\n
  8. The concrete secondary containment of a 10,000-gallon diesel aboveground storage tank was cracked. A release from the tank spilled 8,000 gallons into the containment. The diesel seeped into the underlying soils and required costly excavation and removal. The total cost for investigation, removal and disposal exceeded $320,000.<\/span><\/li>\n
  9. At a Ports wastewater treatment plant pumping station, a faulty valve malfunctioned.\u00a0 As a result, a ruptured pipe released 2.8 million gallons of raw sewage into a local river.\u00a0 The river was used by local fisherman, recreational boaters and marinas.\u00a0 Numerous boats were damaged by the sewage and marinas were forced to close temporarily while cleanup of the raw sewage took place.\u00a0 The total cost of property damage and loss of income claims totaled $400,000.<\/span><\/li>\n
  10. A Port tenant stored hazardous waste in an uncovered dumpster over an unsealed area.\u00a0 Whenever it rained storm water would take some of the waste and deposit it across the land.\u00a0 When the Port began building a new structure high levels of the hazardous waste was discovered in the soil.\u00a0 Costs for the Port to remediate the site exceeded $450,000.<\/span><\/li>\n
  11. An asphalt paving contractor paved a parking lot for a new commercial structure.\u00a0 At the end of the day, the tack coat was sprayed onto the sub-base prior to paving. During the evening, a major thunderstorm caused the tack coat to wash off and flow into a nearby stream. The contractor was responsible for cleanup costs and natural resource damages which exceeded $200,000.\u00a0 The damages caused for the contractors bankruptcy thus leaving the Port as the property owner the responsible party to pay for the damages.<\/span><\/li>\n
  12. After performing routine engine maintenance on a tug boat used to move ships for a port, the boat mechanic accidentally attached the automatic bilge pump to the fuel line.\u00a0 By the time the problem was detected more than 500 gallons of diesel fuel had been pumped into the bay.\u00a0 Cost to the Port for clean up and third party property damage claims exceeded $100,000.<\/span><\/li>\n<\/ol>\n

    ENVIRONMENTAL LIABILITY INSURANCE BENEFITS<\/strong><\/p>\n

    The majority of Port Authorities lack the financial strength to self insure their environmental liabilities.\u00a0 Consideration needs to be given to the economies of scale afforded with environmental liability insurance as part of your risk transfer strategy.<\/span><\/p>\n

    The <\/b>Three Main Benefits<\/b> environmental liability insurance offers:\u00a0\u00a0<\/b><\/p>\n

      \n
    1. <\/b> Defense Costs<\/b>:<\/b> 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, etc.\u00a0\u00a0<\/span><\/li>\n
    2. <\/b> Claim Management<\/b>:<\/b> 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. <\/b> Third Party Liability<\/b>:<\/b> 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 cause an environmental loss.\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0\u00a0<\/span><\/li>\n<\/ol>\n

      ENVIRONMENTAL RISK TRANSFER PRODUCTS<\/span><\/h3>\n

      ENVIRONMENTAL IMPAIRMENT LIABILITY (EIL)<\/b><\/p>\n

      EIL is for Ports susceptible to economic loss caused by pollution that actually or allegedly originated from their operations.\u00a0 Sometimes referred to as pollution legal liability this coverage is for those who own, operate, lease, or have any other insurable interest in real property and the operations.\u00a0 Coverage can be written in a variety of ways addressing unknown preexisting conditions or new conditions.\u00a0 Coverage can include third party bodily injury and property damage along with business interruption and extra expense, on and off site cleanup costs, legal defense expenses, non-owned disposal sites, transportation and more. EIL can be offered on multi year terms.\u00a0 Sewer lines and pump\/lift stations can be covered by EIL.\u00a0 Most EIL policies cover above ground storage tanks and some can include underground storage tanks. EIL coverage can also be used to protect for environmental losses from tenants.<\/span><\/p>\n

      PROPERTY TRANSFER COVERAGE<\/b><\/p>\n

      When buying or selling property there can be unknown preexisting environmental conditions. Since a Phase I or Phase II survey cannot guarantee uncovering all potential environmental liabilities, insurance companies have created property transfer insurance. This coverage protects the new owner or any party with an insurable interest, against unknown environmental conditions that may be discovered during the policy period, that were not caused by the new owner.\u00a0 This coverage not only helps to keep the property at its maximum value, it will assist the purchaser in being able to secure the necessary financing to complete their transaction.<\/span><\/p>\n

      TRANSPORTATION POLLUTION LIABILITY<\/b><\/p>\n

      Generally, business auto or truckers policies will exclude pollution losses arising from spills or other releases of their cargo. Broadened auto pollution liability (typically Form CA 9948) affords coverage during the loading, unloading and transportation, for a spill, release or sudden upset and over turn of transported cargo.\u00a0 Note:\u00a0 An MCS-90 endorsement is not pollution coverage. Coverage can also be acquired to protect against losses from water craft, rail or aircraft.<\/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 have the ability to financially handle a release from an underground storage tank system. 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.<\/span><\/p>\n

      Note:\u00a0 Ports have potential indirect environmental exposures from the vendors you hire to perform services.\u00a0 Should your vendors cause an environmental loss or exacerbate an existing environmental issue their general liability insurance policy generally will have either an absolute or total pollution exclusion.\u00a0 In order to be protected you should make sure your vendors have the proper environment insurance coverage before they do any work on your behalf.<\/span><\/i><\/p>\n

      CONTRACTORS POLLUTION LIABILITY<\/b><\/p>\n

      This coverage can be purchased to meet two specific exposures. First, contractors that perform remedial activities (asbestos, lead, mold, soil or ground water remediation) there is the standard contractor\u2019s pollution liability (CPL) insurance coverage. This protects the insured for pollution conditions they may cause or exacerbate an existing situation while performing remedial services. This is for covered operations performed by or on behalf of the insured.\u00a0 The loss must occur away from any premises the insured owns, rents, leases or occupies, in other words while they are performing remedial services at an educational institution.<\/span><\/p>\n

      Secondly, standard contractors (i.e. general contractors, HVAC, plumbing, electrical, mechanical, janitorial, demolition, drilling, excavation, 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.<\/span><\/p>\n

      PROFESSIONAL LIABILITY (E&O)<\/b><\/p>\n

      Should a environmental engineer\/consultant or analytical laboratory make an error or an omission in performing professional services for you they will need a E&O policy including pollution for there to be coverage.\u00a0 Some professional services could include Phase I or Phase II site assessments, All Appropriate Inquiry (AAI), air monitoring, lead and asbestos assessments, waste characterization, remedial action plans, water testing, mold survey\u2019s, environmental training\u2026.<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"

      Environmental exposures include spills\/releases during loading\/unloading process;\u00a0 Pollutants being shipped through the port;\u00a0 Illegal \/ midnight dumping of pollutants, fuels, waste from tenants 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":[121,120],"class_list":["post-2777","post","type-post","status-publish","format-standard","hentry","category-risk","tag-ports","tag-transportation","entry"],"_links":{"self":[{"href":"https:\/\/estrategist.com\/members\/wp-json\/wp\/v2\/posts\/2777","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=2777"}],"version-history":[{"count":2,"href":"https:\/\/estrategist.com\/members\/wp-json\/wp\/v2\/posts\/2777\/revisions"}],"predecessor-version":[{"id":2780,"href":"https:\/\/estrategist.com\/members\/wp-json\/wp\/v2\/posts\/2777\/revisions\/2780"}],"wp:attachment":[{"href":"https:\/\/estrategist.com\/members\/wp-json\/wp\/v2\/media?parent=2777"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/estrategist.com\/members\/wp-json\/wp\/v2\/categories?post=2777"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/estrategist.com\/members\/wp-json\/wp\/v2\/tags?post=2777"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}