Environmental Liability
Environmental Liability Directive - What it means for your business
The European Directive on Environmental Liability (2004/35/EC) seeks to achieve the prevention and remedying of environmental damage In particular, damage to habitats and species protected by EC law or on a site of special scientific interest. In addition it covers damage to water resources, and land contamination which presents a threat to human health. The authorities in the UK who monitor environmental damage include the Environment Agency, Marine and Fisheries Agency, Countryside Council and Local Authorities.
The regulations are based on the “polluter pays” principle – so those responsible prevent and remedy environmental damage instead of the taxpayer. Your current liability policy may not cover for environmental damage.
Your responsibilities under the directive means you must:
- Take steps to prevent damage or further damage and notify the relevant authority.
- Provide information and undertake preventive and remedial measures as required by the authority.
- Submit proposals for remediation.
- Pay any costs claimed by the authority in relation to environmental damage.
Environmental Impairment Liability Insurance
Environmental Impairment liability insurance helps protect companies from the uncertainty of potential environmental liabilities associated with owning or operating facilities or sites and protects buyers and sellers in mergers acquisitions or divestitures.
The policy can protect against liabilities for property damage, bodily injury and remediation costs from future pollution incidents arising from site or site based actions. In addition the insurance cover provided is for sudden, accidental and gradual pollution incidents and so extends beyond cover given by traditional Liability policies.
Other Key Features can include:
- Own site and off site clean-up costs are covered (remediation costs) to the extent required by environmental law and or ordered by local/Federal Government.
- Pay any costs claimed by the authority in relation to environmental damage.
- Emergency expenses to deal with the consequences of a pollution incident before likely serious harm to human health or serious environmental damage actually arises.
- Indemnity for directors and employees.
- No retroactive date needed - therefore it is ideally suited to support mergers and acquisitions (M&A) or any land transportation where there may be a concern about pre-existing contamination or pollution.
- Annual renewal.
- Extended reporting period up to 48 months following policy termination available (where renewal of policy not required).
- New liabilities under the European Environmental Liability Directive (Directive No.2004/35/EC) can be covered if and when required.
- Up to £5,000,000 limit of liability and or as agreed.
- Can provide cover for historical pollution.
Other features of the insurance
- Business Activity – including cover for owned / operational sites, contracted activities and transportation under the same policy.
- Includes the Companies Offshore and Offshore business operations.
- Include lenders as an Insured.
Swinglehurst is able to provide unparalleled assistance on this very complex but nevertheless increasingly important area of financial risk and liability.
Our Environmental Risk and Insurance Services can place specialist insurance, reinsurance and other financial instruments to cater for a broad spectrum of interests including:
- Multinational corporations
- Utility Companies
- Ports
- Manufacturing
- Aviation Companies and Authorities
- Mining
- Petroleum and Energy Sector
- Renewable Energy Sector
- Development Banks
- Central and Local Government
- National and International Banks
- Private Sector / Equity Investors
- Specialist Projects e.g. large scale construction projects in Sustainable Economic Development / City Regeneration
- Property Investors and Developers
- Aquaculture
Often our clients require assistance in identifying their environmental risk and the financial instrument options which may be available to them. Swinglehurst provide the very necessary consultancy services to support our client’s in this complex area which is otherwise almost entirely neglected by parallel professional service providers.