Insurance archaeologist helps keep matters out of litigation
By Dennis Pillsbury
Anyone who has perused cases involving clean-up of Superfund-identified hazardous waste sites probably winds up shaking his or her head at the complexity of the claims and the often inane resolutions where only the attorneys seem to leave happy. There was one case where a business was required to pay for the clean-up of lead pollution that dated back to a Revolutionary War armory that once occupied the site. Needless to say, that armory was no longer around to help pay for the clean-up. And the pollution had leeched into the ground water. It was not an inexpensive proposition.
All too often, an environmental problem can mushroom into a business-threatening event or the killer of an otherwise attractive merger or acquisition. And if that company is one of your clients, you’ll want to do everything you can to help keep it out of bankruptcy proceedings.
So, who ya gonna call?
David O’Neill doesn’t carry a proton pack on his back, but he may very well be the man for the job. Dave is a forensic investigator and insurance archaeologist who works for EnviroForensics in Indianapolis, a national environmental engineering firm that focuses on restoring financial viability to businesses facing environmental problems. He started doing insurance archaeology in 1993. Prior to that, he worked with the Environmental Protection Agency.
We talked to Steve Henshaw, chief executive officer of EnviroForensics and Dave about the unusual expertise they bring to the environmental field. Steve, who is a registered geologist with more than 20 years of experience in environmental clean-up, explains that the company was set up as a full-service firm that brought together all the disciplines needed to solve environmental problems—engineers, geologists, scientists, private investigators, insurance specialists and legal counsel.
EnviroForensics investigates possible contamination of soil and ground water and provides remediation services. “We also do a lot of litigation support,” Steve says. “We develop and prove facts, providing the science expertise. We also get involved in private investigation, including responsible party searches, records research and allocation analysis.”
Dave adds: “As part of our effort to find funds to help a property owner or business that is facing a pollution exposure, we offer our Confidential Insurance Archeology (SM) service. We conduct a search for old insurance policies or parts of policies or evidence that the policy existed. We look for the insurance coverage of both the current owners and the past owners and operators who may have contributed or caused contamination.
“We bring the insurance information up early so the insured does not have to go to an attorney,” Dave continues. “The objective is to reduce litigation in all these matters. If an environmental case does go to court, it can take forever and no one is happy at the end expect the lawyers.”
Steve says: “Our job is to find solutions to problems. If there are merger talks, our job is to facilitate the closing of the deal by resolving pollution exposure and liability. We help find funding for clean-up and then will work on solutions like holding the property in another entity until the clean-up has occurred.”
EnviroForensics also has done extensive work with municipalities which have had to rely on the brownfield program to deal with environmental problems. “There’s just not enough money in the program,” Steve points out. “The municipalities can’t afford to clean-up abandoned sites, so they remain abandoned. We’ll come in and help them find other sources of funding so they can resolve the environmental problem and attract a tax-paying business.”
Insurance agents often become involved when they hear from a client who is trying to locate old policies. And when a client cries, “Help!,” then the agent has to respond.
“The agent is asked to document coverage for a number of years and may have policies dating back only seven years,” Dave explains. “We’ll be called in to help them uncover old policy numbers or other evidence of previous coverage.”
“We also get called in by insurance companies to search for other company exposures,” Steve says. “The insurance company response to our efforts run the gamut. Some companies will want to fight the claim regardless of the merits of the case, while others are willing to pay the claim and resolve the problem without the involvement of attorneys.
“The whole key to our service is to provide a non-adversarial solution to environmental problems,” Steve concludes. “Our objective is to develop solutions outside of the litigation arena and allow deals to be completed or bankruptcy avoided by remediating the environmental problems and finding the funds to pay for remediation.”