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Heightened attention to environmental impairment and human health risks caused by volatile organic compounds (VOCs) through vapor migration is increasing environmental liability risks. In some states, including Massachusetts, regulators are reopening hundreds of sites that were previously remediated, to require additional risk assessments and site investigations.​Vapor intrusion (VI), in which volatile chemicals contaminate indoor air from underlying soil or groundwater, poses a challenging environmental liability risk. Migrating vapors can cause bodily injury and property damage, leading to liability for current or previous property owners, developers, contractors and environmental consultants. ​Volatile chemicals in subsurface soil or a groundwater source usually do not present serious health risks in ambient air, where they can dissipate, but they can cause injury if inhaled by people in the confined spaces of residential or commercial buildings. ​Assessing VI is complex, as many variables are involved and toxicity is influenced by the concentration and duration of VOC exposure. Air quality samples can vary depending on air flows created by heating, ventilation and air conditioning systems, known as a stack effect; time of year; and vertical and horizontal positioning of the sampling. False positive and false negative results are possible because of these variations. If VI is found to be a problem, different mitigation and remediation approaches can be implemented.​According to Mary Ann Susavidge, Chief Underwriting Officer for XL Catlin’s North America Environmental business, “When indoor air quality issues are being addressed, everyone is talking about the risks of mold and legionella.  Vapor intrusion is talked about a lot less, but poses no less risk.  We are seeing claims against businesses where vapor intrusion is impacting their property from volatiles under their own facilities or coming from adjacent properties.”  ​

When indoor air quality issues are being addressed, everyone is talking about the risks of mold and legionella.  Vapor intrusion is talked about a lot less, but poses no less risk.
To protect businesses from the liability associated with vapor intrusion, pollution insurers offer site-specific coverage such as XL Catlin’s Pollution and Remediation Legal Liability (PARLL) insurance policy.   PARLL coverage offers claims-made coverage for sudden and accidental and gradual environmental exposures, including vapor intrusion at a property.​A clear understanding of VI and regulatory requirements, along with a comprehensive risk assessment and mitigation program and the right environmental insurance coverage, are important ways for businesses to manage their environmental liability risk.​For more information on environmental liability and vapor intrusion, download XL Catlin’s risk bulletin. ___________________

The information contained herein is intended for informational purposes only and does not constitute legal advice. For legal advice, seek the services of a competent attorney. Any descriptions of insurance provisions are general overviews only. 

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Global Asset Protection Services, LLC, and its affiliates (“AXA XL Risk Consulting”) provides risk assessment reports and other loss prevention services, as requested. This document shall not be construed as indicating the existence or availability under any policy of coverage for any particular type of loss or damage. AXA XL Risk. We specifically disclaim any warranty or representation that compliance with any advice or recommendation in any publication will make a facility or operation safe or healthful, or put it in compliance with any standard, code, law, rule or regulation. Save where expressly agreed in writing, AXA XL Risk Consulting and its related and affiliated companies disclaim all liability for loss or damage suffered by any party arising out of or in connection with this publication, including indirect or consequential loss or damage, howsoever arising. Any party who chooses to rely in any way on the contents of this document does so at their own risk.

US- and Canada-Issued Insurance Policies

In the US, the AXA XL insurance companies are: AXA Insurance Company, Catlin Insurance Company, Inc., Greenwich Insurance Company, Indian Harbor Insurance Company, XL Insurance America, Inc., XL Specialty Insurance Company and T.H.E. Insurance Company. In Canada, coverages are underwritten by XL Specialty Insurance Company - Canadian Branch and AXA Insurance Company - Canadian branch. Coverages may also be underwritten by Lloyd’s Syndicate #2003. Coverages underwritten by Lloyd’s Syndicate #2003 are placed on behalf of the member of Syndicate #2003 by Catlin Canada Inc. Lloyd’s ratings are independent of AXA XL.
US domiciled insurance policies can be written by the following AXA XL surplus lines insurers: XL Catlin Insurance Company UK Limited, Syndicates managed by Catlin Underwriting Agencies Limited and Indian Harbor Insurance Company. Enquires from US residents should be directed to a local insurance agent or broker permitted to write business in the relevant state.