Companies that are involved, or could be involved with environmental issues need to fully understand the importance of buying suitable insurance protection. Unfortunately, it is often the case that a claim arises and only then is the insurance policy scrutinized only to find that it doesn’t cover the claim. You can’t buy insurance retrospectively, so waiting until a claim is filed is something to be avoided.

It’s always important to remember that each company has their own priorities which are obviously linked directly to the business they are involved in. It is therefore the job of specialist insurance organizations to educate companies to the need to buy environmental insurance and to ensure they understand it.

The problem is that insurance terminology can be confusing, difficult to comprehend and to most people, utterly boring. However, the importance of having the correct type of environmental coverage cannot be stressed enough. Take a look at a few areas of environmental insurance terminology that may create confusion to an insured company as it may help them understand it better. More importantly, a clear and concise understanding of policy terms between insurer and insured means that fewer discrepancies may arise, should a claim arise.

1. Monetary response times can cause some smaller companies immense cash flow problems in the event of a claim. The discovery of a pollution situation usually means that action has to be taken immediately and that can cost a lot of dollars. Ensuring that the insured is fully aware of the terms of the policy in respect of emergency response costs is imperative. Some policies include this type of cover, others do not. The policy will usually state the amount that can be paid without prior investigation; other policies expect the insured to cover the cost, until they have completed their investigation and approved the costs. There can be a considerable time difference between the two.

2. Always ensure that an insured is fully aware of any responsibilities they may have regarding the natural resources that may need replacing or restocking after the clean-up from a pollution accident. Clarity is important. Most environmental insurance policies will cover the clean-up in full, but it may not include replacing the natural habitat. For example, if it was a river stocked with fish that was polluted, is replacing the fish the responsibility of the insurer or the insured.

3. Ensure that the insured is fully aware of whether transportation of goods and cargo between one site and another is included. It is often presumed that the transportation company’s insurers will cover this event, but it may not include pollution. Let them know clearly, so they have the option of buying this additional cover.

4. An insurance company paying for the clean-up of property is one thing, but it doesn’t mean the insurer is necessarily paying to restore the property to how it originally was. Make certain it’s clear what responsibilities are down to the insurer and those that are down to the insured.

Clarity and understanding between all parties will ensure that in the event of a claim the matter is dealt with swiftly and effectively.

Find out more about Environmental Contractor Insurance and how Beacon Hill Associates can help you.

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Author Bio: Find out more about Environmental Contractor Insurance and how Beacon Hill Associates can help you.

Category: Business Management
Keywords: Environment, Insurance, Business