The environmental consulting service industry has seen significant growth in the last several years. With increased concern over soil/groundwater contamination, air quality, mold, and other pollutants, the demand for these types of consultants will continue to be on the rise. Environmental consultants work in a variety of industries, from construction, to waste management, real estate and of course regulatory agencies. We have years of experience working with a wide range of environmental consultants and we are here to assist you in explaining the need for environmental coverage to these clients and seek the options that best suit them.

Environmental Consultants

The environmental consultants category covers many different areas of environmental risk assessment. These consultants help ensure the legal compliance as well as safety of areas they assess. Some examples of the work environmental consultants perform may include:

Phase I, II, III Reports
Consultants assess property to determine if any historical or pre-existing pollution or contaminant condition exists.

Soil Sampling and Analysis
Provide laboratory analysis of soil and water to determine potential risks to health and safety.

Storage Tank Assessment
This category includes those who perform inspections to ensure storage tanks are in compliance with legal guidelines as well as detecting any potential and existing pollution conditions.

Wetlands Assessment
Examples of the duties involved in this type of consulting include identifying and delineating wetlands, assistance with obtaining proper permits as well as environmental assessment of the land.

Health & Safety
Provide training and continuing education for employees regarding safety guidelines and environmental regulations compliance. In addition, these consultants may help create or advise how to create health and safety plans for businesses.

Inspection for Contaminants
Inspect locations to assess potential contamination in the form of lead, mold, asbestos, radon, and other possible risks. These inspections can help identify potential indoor air quality issues that may affect the health of residents or workers at a location. In addition to performing inspections the consultant can, in some cases, advise the client how to mitigate the contamination and monitor for potential contamination in the future.

Expert Witness/Litigation Support
Provide for legal advice or testimony based on their area of understanding regarding environmental regulations and potential contamination exposures.

Coverage for Environmental Consultants

This will vary by class, but we can offer General Liability with Contractors Pollution and Professional Liability; the Professional being a consultant’s most significant exposure in many cases; a Combined Contractors Pollution/Professional Liability policy if the GL is already placed elsewhere; Fixed Site Pollution Liability for facilities the consultant may own, including GL; Auto with broadened pollution, both on a standalone and package basis; and Excess products.

GL/Contractors Pollution Liability/Professional
This is generally the best option of coverage for an environmental consultant. Not only does it cover their General Liability and Pollution exposures, but most importantly it covers their Professional exposure as well (which is typically the most important coverage for this type of risk). With this option everything is written on a single form, offering the best price for the coverage given.

Contractors Pollution Liability/Professional
There are times in which general liability is placed for an environmental consultant but you are having difficulty finding a home for the Professional and pollution coverage. We can write them both on a combined form so that not only is their Professional covered but also their Pollution (which is generally a contract requirement for most companies).

Transportation Pollution Liability
Transportation Pollution Liability, or TPL, is “over the road” pollution insurance. It covers insureds’ or third party carriers that transport products that could cause a pollution condition. This coverage can also include loading/unloading should the insured’s cargo create a pollution condition.
Sample Policies

Below are a few examples of policies that Beacon Hill has been successful in writing for Environmental Consultants.

$3,000,000 soil analysis consultant and broker
Coverage purchased: General Liability, Contractors Pollution, Professional Liability
Policy limit: $1 million/$2 million
Premium: $13,000

$2,300,000 SIRA & CITLDS (Tank Leak Detection) consultant, installation of tank monitoring systems
Coverage purchased: Contractors Pollution, Professional Liability
Policy limit: $2 million/$2 million
Premium: $26,000

$150,000 Wetlands consultant including Phase I reports with unrelated contracting services
Coverage purchased: General Liability, Contractors Pollution, Professional Liability
Policy limit: $1 million/$2 million
Premium: $3,023

$25,000 Phase I Assessment and hydrogeological investigation consultant
Coverage purchased: General Liability, Contractors Pollution, Professional Liability
Policy limit: $1million /$1million
Premium: $3,000

$235,000 Phase I, II, III assessments, Project management, Remediation oversight, remedial design, and compliance/permitting consultant
Coverage purchased: General Liability, Contractors Pollution, Professional Liability
Policy limit: $1 million/$2 million
Premium: $2,800

$20,000 Water treatment maintenance and assessment consultant
Coverage purchased: General Liability, Contractors Pollution, Professional Liability
Policy limit: $1 million/$2 million
Premium: $2,600

$140,000 Mold assessment/testing consultant
Coverage purchased: General Liability, Contractors Pollution, Professional Liability
Policy limit: $1 million/$1 million
Premium: $2,600

$2,000,000 Regulatory Compliance assessment, process control system review, appraisal of operational procedures & training consultant
Coverage purchased: General Liability, Contractors Pollution, Professional Liability
Policy limit: $1 million/ $2million
Premium: $9,500

Claims Scenarios

An environmental consultant provided plans and specifications for the installation of monitoring wells at a contaminated facility. Contamination had seeped from the ground surface into a shallow aquifer. Following installation of monitoring wells, sampling showed evidence of contamination in both the shallow aquifer and in a lower lying aquifer. The facility owner filed a claim against the consultant, alleging that well placement (location and depth) was responsible for the cross contamination of the lower lying aquifer. The settlement amounted to $250,000.

A hazardous waste site hired an environmental consultant to develop a health and safety plan and provide inspection services. During remediation of the site, a subcontractor who was not equipped with proper respiratory protection died from inhalation of unknown contaminants. The subcontracted firm and the employee’s family filed a claim against the consultant for improper health and safety precautionary measures and negligent oversight of the work in progress.

A landfill retained an environmental consultant to design and perform construction observation for improvements to a site, including the installation of a storm drainage system. An explosion occurred in a concrete out-flow box into which the landfill system drained. Bodily injury claims due to worker injuries exceeded $400,000.

An environmental consultant performed a Phase I Site Assessment at a site that had been used previously for industrial purposes. The consultant submitted a report stating that negligible contamination had been found. The property was subsequently sold. During excavation, an unregistered leaking underground storage tank (UST) was discovered on the site. The property developer sued the consultant for $1.2 million for remediation expenses, lost profits, and diminution in value.

An environmental consultant failed to delineate wetlands on property which was to be developed into a new regional landfill. As a result, the landfill had to be reengineered, thus delaying its opening. The settlement amounted to $7 million.

A large home retailer was buying numerous sites for new store locations. An environmental consultant was hired to perform Phase I evaluations on all of the sites. Due to internal personnel changes, the report was sent over without completing the last site’s evaluation, where several old underground storage tanks containing hydraulic fluid were discovered. Cleanup cost liabilities for the consultant: $1 million plus.

A developer needed to perform a Phase II assessment after an earlier Phase I assessment had identified several areas of concern. The environmental consultant recommended a total of 50 borings with several samples per boring. Due to the cost, the developer requested the consultant to cut the borings in half. A heavy oil contaminant in the ground was not found until development began. Litigation and clean-up cost liabilities for the consultant: $1 million.

Overcoming Hurdles When Discussing This Coverage with Your Client

I have cheaper coverage.
With so many different carriers in the market place, you can often find a wide range of prices for the products that are offered. The important thing here is that generally you get what you pay for. If your insured has a lower priced quote, make sure to get a copy of the endorsements list and the name of the carrier to evaluate that the proper coverage and enhancements are in place that your insured really needs. Nothing worse then finding out that your insured has an exclusion on their cheaper policy at the time of a loss.

I have never had a loss, why would I want this coverage?
a) Just because you haven’t had a loss yet doesn’t mean you won’t in the future. The price to cover yourself and your money is minor compared to the amount of money it costs to defend, clean up, and repair any losses that occur due to a pollution or professional loss. Just look at some of the common claim scenarios above.

b) As the EPA continues to increase regulations, more companies are requiring Pollution & Professional coverage when contracting an environmental consultant. More often than not, if your insureds are in a bidding situation, having this coverage already in place will give them an upper hand over their competition and show their understanding of the industry in which they work.

Applications for Consultants

The required application and underwriting information will vary on the insured and coverage being requested. Please contact us to discuss any opportunities. Combined Contractors Pollution, General Liability, and Professional policies start as low as $2,500 plus taxes and fees depending upon the revenues, type of work performed, and limits requested.