Category: Using Insurance for Environmental Cleanups

Maximizing Your Business Asset

Posted on by Jeff Carnahan

Written by Stephen Henshaw, P.G., President & CEO, EnviroForensics
As seen in June 2011 issue of Cleaner & Launderer

PDF Version

Just a few short years ago it was nearly impossible for me to have an open and honest discussion with dry cleaners about the possibility that soil and groundwater beneath their business might be impacted with dry cleaning solvents. Understandably, dry cleaners were scared that the value of their business would be diminished if such conditions existed. Environmental investigations and cleanups can be costly and legal bills alone are more than many businesses can afford. Hiding one’s head in the sand does little to build or preserve a business as an asset.

Over the years I have preached the merits of looking for old insurance policies, normal everyday comprehensive general liability (CGL) policies, to see if they can be utilized to assist in funding site investigation and remediation costs. Even though we have countless success stories in this unique, specialized business area of finding the funding to pay investigation and cleanup costs, rarely a week goes by where we discover a dry cleaner that is either unaware that old policies have great value or they think that there is a better day ahead to implement this strategy. The reality is that with few exceptions, there is no time like the present. Continue reading “Maximizing Your Business Asset”

Flexdar Court Sides With Insureds: Reinforces Kiger; Broadens “Ambiguous” Interpretation of Absolute Pollution Exclusion Language

Posted on by Jeff Carnahan

Written by Justin Gifford, J.D., General Counsel, EnviroForensics and PolicyFind

The Indiana Court of Appeals’ November opinion in the recent State Automobile Mutual Insurance Co. v Flexdar, Inc. (Ind. App. 2010) comes as good news to business owners like drycleaners who currently or have historically used tetrachlorethene (perc) or petroleum solvents that may have been released into the environment.  The Appellate Court’s decision re-examined the landmark American States Insurance Co. v. Kiger (662 N.E.2d 945, Ind. 1996) as well as its progeny and found for Flexdar, Inc., the insured.  (Kiger established that the absolute pollution exclusion found in many general commercial liability (GCL) policies is ambiguous and, as a result, ineffective in insulating insurers from their duties to defend and/or indemnify their insureds for claims made by the Indiana Department of Environmental Management that the insureds investigate and clean up releases of perc or other substances into soil and groundwater.)  Continue reading “Flexdar Court Sides With Insureds: Reinforces Kiger; Broadens “Ambiguous” Interpretation of Absolute Pollution Exclusion Language”

U.S. Circuit Court Finds Limits to Indiana’s Kiger Decision in Federated’s Unambiguous Policy Language

Posted on by Jeff Carnahan

By David A. O’Neill, J.D., Director of Investigations, Policy Find

The question of how broadly the Indiana Supreme Court’s ruling in American States Insurance Company v. Kiger, 662 N.E. 2d 945 (Ind. 1996) can be interpreted was further decided on March 25, 2010 when the United States Court of Appeals, Seventh Circuit reached a decision in the West Bend Mutual Insurance Company v. U.S. Fidelity and Guaranty Company case.  This appellate decision is a caution to those owners and operators of retail gasoline service stations, who have been waiting to have their properties tested for pollutants in reliance on the effect of the Kiger ruling.  They will now be carefully reviewing the pollution exclusionary and definitions clauses in their policies to determine whether the Kiger or West Bend rules apply to their situations.

 In its published opinion, the Seventh Circuit explained its decision to affirm the U.S. District Court’s interpretation of a Federated Mutual Insurance Company umbrella liability policy which had been found to exclude coverage for pollution of neighboring property occasioned by leaking underground gasoline storage tanks. Continue reading “U.S. Circuit Court Finds Limits to Indiana’s Kiger Decision in Federated’s Unambiguous Policy Language”

It’s a Good Idea to be Proactive!

Posted on by shenshaw

Written by Steve Henshaw, President & CEO, EnviroForensics in collaboration with Justin Gifford, General Counsel, EnviroForensics
As seen in the January 2010 issue of Western Cleaner & Launderer

PDF Version

Opening up Google, a newspaper, turning on the radio or catching the evening news is sure to expose you to the national debate over health care and insurance. Through that exposure, most of us have gained at least a passing familiarity with the issue of “pre-existing conditions.” Insurers either refuse outright to cover a person with a pre-existing condition or exclude that condition from the coverage, leaving the insured to pay for it out of his pocket. Environmental liabilities and using historical insurance to offset those liabilities are not the focus of a lively national  debate, yet the costs incurred by drycleaners each year due to a similar problem are staggering.

We receive calls on a regular basis from drycleaners or property owners already engaged in defining the size of a spill or actively remediating it at the “request” of regulatory agencies asking for our help locating historical insurance to pay for the investigation and cleanup. Often times, we are able to locate that insurance to fund the clean up…but just as often, the twenty, thirty or   hundred and fifty thousand dollars already spent by our client cannot be recovered from the insurer even though the spending was necessary to comply with the regulator’s orders.

Continue reading “It’s a Good Idea to be Proactive!”

Using Old Insurance to Cover Investigation and Clean-Up Costs

Posted on by shenshaw

Written by Steve Henshaw, P.G., President & CEO, EnviroForensics
As seen in the September 2009 issue of Cleaner & Launderer

PDF Version

I heard from some readers that my last few articles were a little too technical and in addressing those comments, I’ve decided to go back to basics. That is to say, what are basic concerns that dry cleaners have? Since this is the Environmental Corner and staying with that topic, it is my experience that one of those basic concerns that dry cleaners might have deals with the questions,“How am I going to pay for an environmental investigation and clean-up?” Old insurance policies may be an answer.

For years I’ve espoused that business owners need to find their old comprehensive general liability (CGL) policies and store them in a safe, dry and fireproof place. CGL policies were purchased by business owners to cover them against all liability exposures of a business unless specifically excluded. Coverage includes products, completed operations, premises and operations, elevators, independent contractors, to name a few. Note the key words, “unless specifically excluded.” These words are very important in determining whether an individual or businesses old insurance policies can be used to pay for environmental investigations and clean-ups.

Continue reading “Using Old Insurance to Cover Investigation and Clean-Up Costs”