Apartments – Mold

Widespread Mold caused multiple problems for tenants and the property owner.  A few years after construction of an upscale apartment community, tenants complained about mold in bathrooms.  Multiple buildings and units within the complex experienced similar problems over the next few months.  Some tenants moved out and filed claims for alleged bodily injury and property damage.  An extensive investigation revealed that construction defects associated with HVAC systems and showers caused severe water intrusion and moisture build-up leading to widespread mold growth.  Damages to the property owner included loss of rents, clean-up costs, and settlements with injured tenants totaled over $2,000,000.

Developer – Contaminated Soil

New construction commenced on a previously undeveloped parcel of land.  During excavation and dewatering activities, contaminated groundwater was discovered.  The developer was required by State regulatory authorities to collect, test and treat groundwater pumped out during the excavation process.  Contaminated soils were also discovered at the site.  Construction delays and additional expenses totaling over $1,000,000 were incurred by the developer.  It was eventually determined that the contamination had migrated from a nearby manufacturing facility that had gone into bankruptcy several years prior to the development project.

Distribution Facility – Chemical Release

Over the weekend, vandals climbed the fence at a chemical distribution facility. Besides breaking a few windows, they also damaged a valve on a 10,000 gallon tank of chemicals. The damaged valve leaked until Monday morning when it was discovered by facility employees. While most of the contents of the tank just needed to be removed and disposed of from the containment area, local environmental officials required subsurface testing of soils and groundwater so that total costs reached $90,000.

Hospital – Legionella

Legionella was discovered in the water supply of a major metropolitan hospital. An entire wing of the hospital needed to be vacated and patients removed while the water system went through treatment for the Legionella.  In addition to the remediation costs, several patients sued the hospital claiming bodily injury from exposure to the Legionella.

Shopping Center – Dry Cleaner

A dry cleaner tenant located in an upscale shopping center was found to have been illegally operating by failing to maintain adequate containment of spent perchloroethylene (PCE) solvent canisters.  The canisters were stored in an exterior trash container and over time the PCE leaked onto the cracked macadam surface and eventually migrated off-site.  The plume traveled with the flow of groundwater and contaminated several adjacent residential properties requiring cleanup.  The residents filed bodily injury and property damage claims against the dry cleaner and the owner of the shopping center.

Property Owner/Residential – Historic Issue

A housing stock transfer was undertaken between a local authority and a private management company involving approximately 7,000 residential units.  A problem emerged when unusually high levels of lead, arsenic and zinc were discovered on surrounding properties.  When tests were conducted, it became apparent that the residential units had been built on land used as a chemical dump from the early 1900s to 1960s by a company still operating in the area.  A class action was brought against the local authority by residents, alleging health risks and diminishing property values.  Residents perceived to be at risk from the presence of contamination were relocated. Significant investigations were undertaken to assess the extent of the problem.  A combination of remediation, compensation, and relocation of residents was eventually achieved and paid for by the original polluter.  Although liability was not deemed to ultimately lie with the local authority, significant costs were incurred to demonstrate the absence of liability.  The local authority was eventually able to recover the costs incurred through a claim against the responsible parties, including the previous landowner and the developer.

Nursing Home – Mold

City inspectors received notice of possible building violations at a nursing home facility.  Inspection of the facility found the building’s roof and interior were in violation of city codes.  The violations were serious in nature including signs of water damage on ceilings, light fixtures and electrical switches.   Additionally, several employees reported a mold/mildew odor.  A further investigation discovered black mold within ceiling tiles, under layers of peeling paint, and in areas of noticeable water leakage.  Residents of the facility were showing symptoms of rashes, headaches, asthma and difficulty breathing. The facility had to be temporarily shut down and the residents relocated before cleanup of the extensive mold could begin.  Families of several of the residents filed suits for bodily injury against the facility.

Municipality – Petroleum Soil Contamination

A municipality purchased a former manufacturing facility as part of a larger brownfield redevelopment project.  After taking control of the property and beginning the project, the municipality discovered an old tank was missed during due diligence.  Soil samples taken from the tank pit were impacted with petroleum.  The area had to be over excavated and additional costs were incurred to properly dispose of the soils.

Manufacturing Facility – Hazardous Liquid Waste

An unknown party illegally placed a container of hazardous liquid waste into a dumpster at a small manufacturing facility.  The container leaked and contaminated the contents of the load which in turn contaminated the waste on the tipping floor of the transfer station.  Cleanup costs and legal fees exceeded $150,000.

Laboratory – Hazardous Materials

A drum of spent solvent waste located in a storage shed on the property of a laboratory was knocked over as employees were attempting to move several drums.  Before the spill was contained, the solvent waste ran across the laboratory’s parking lot and on to the ground of an adjacent property.  The laboratory was responsible for the associated emergency cleanup costs.

Developer – Contaminated Soil

New construction commenced on a previously undeveloped parcel of land.  During excavation and dewatering activities, contaminated groundwater was discovered.  The developer was required by state regulatory authorities to collect, test and treat groundwater pumped out during the excavation process.  Contaminated soils were also discovered at the site.  Construction delays and additional expenses totaling over $1 million were incurred by the developer.  It was eventually determined that the contamination had migrated from a nearby manufacturing facility that had gone into bankruptcy several years prior to the development project.

Car Service Center – Oil

An oil water separator for a car service center developed a fracture in one of its underground pipes.   Over time, oil seeped from the system into the surrounding soil and groundwater, contaminating both the car dealer’s land and a neighboring property.  The extent of the contamination was not realized until an oil sheen was noticed on a nearby stream.  An investigation was conducted and resulted in a contaminated soil and groundwater treatment program.  The need to quickly mitigate impacts to the stream required an expedited remediation schedule, further increasing the cleanup costs.

Fire causes evacuations

A manufacturing facility generates waste filter cake containing precious metals and ships the waste to a metal recycler. Before shipping, the filter cake needs to cool to an ambient temperature. The filter cake is accidentally shipped hot and catches fire at the waste facility, which results in the evacuation of several area businesses.  Environmental Site Liability insurance pays for bodily injury, property damage and remediation costs as a result of the waste at a nonowned facility.

Concerns imperil sale

An international chemical corporation was selling a manufacturing facility. Because of concerns over possible soil and groundwater contamination, the buyer included in the purchase and sale agreement a requirement that the seller obtain an Environmental Site Liability policy.  A policy with limits of $10 million and a 10-year policy term was put in place, naming both buyer and seller as insureds and allowing the sale to proceed.

Property reveals past

A buyer wanted to purchase property with a flower shop located on it. Phase 1 assessment revealed that the site had once been a retail gas station. The seller was required to provide an indemnity agreement to pay for pollution that might be discovered. The purchase was in doubt until a five-year Environmental Site Liability policy was put in place insuring the buyer against future claims for on-site cleanup of historical but unknown contamination.

Solvents spell liability

A semiconductor manufacturer contaminates adjacent property with chlorinated solvents.  The manufacturer is sued, resulting in a $10 million settlement.  Environmental Site Liability insurance helps protect the manufacturer against a potentially huge loss.

Remediation Expense and Defense Costs: $1.25M+

The owner of an industrial park was notified by the state environmental agency that it had received a complaint regarding groundwater contamination at a neighboring site.  They requested an investigation at the industrial park. The investigation indicated that a former tenant at the industrial park caused the contamination.  The former tenant fought the allegation.  The state ordered the owner to start remediation of the site. The owner then sued the tenant for recovery of remediation costs, and had to defend lawsuits from neighbors surrounding the industrial park.  The investigation, remediation expense, and legal costs exceeded $1.25M.

Remediation Expense, Property Damage, and Natural Resource Damage: $900,000

Waste oil was transferred to a tank at a bulk storage facility. The tank was over-filled and waste oil spilled into the secondary containment system. A valve in the secondary containment system was left open during a recent clean-out. The waste oil was released into the neighboring river. The spill impacted a marina, river, wetlands, and wildlife. Losses included remediation expenses for emergency response on the river, and property damage included the cleaning of boats and docks. Natural resource damages were also incurred for lost wildlife and damaged wetlands. Total losses were nearly $1M

Emergency Response: $72,000

A fertilizer plant was damaged during a violent storm. A tank was blown over by high winds and knocked a valve off of an anhydrous ammonia tank.  The release of ammonia resulted in a clean-up and response action by over seven government agencies and emergency responders.  Residents within a two-mile radius of the plant were evacuated due to fumes released into the air.  The site owner was billed over $70,000 for the costs of the emergency response actions to stop and contain the release and conduct the evacuation.

Property Damage and Bodily Injury: $1.1M

An ammonia gas leak was detected at a food processing and refrigeration warehouse which used the gas as a refrigerant.  The release caused an evacuation of everyone within a one-mile radius of the warehouse.  There were inhalation related injuries to seventy-five people, and damage to food products loaded on trains for delivery.  Five people were sent to intensive care for complications related to lung damage.  The property damage costs were $50,000, while bodily injury and defense costs exceeded $1M.

Mold Liability: $1.25M+

Tenants of an apartment complex alleged that exposure to mold impaired their ability to function. Bodily injury claims included headaches, inability to concentrate, and difficulty breathing.  The tenant filed a lawsuit. Defense costs were over $1M and the settlement costs were over $250,000.

Remediation Expense, Liability, and Defense: $6.6M

Vandals broke into a storage shed at a utility yard and stole containers of mercury.  They dumped the mercury onto the lawn of a neighboring apartment complex. The mercury was tracked into the buildings by the tenants.  Shortly thereafter, they started to complain of nausea, vomiting, and other symptoms. The complex was shut down for several months for remediation of the soil and decontamination of the buildings.  The apartment owner spent $6.6M on clean-up costs and faced lawsuits for bodily injury and destruction of personal property due to mercury contamination.  The apartment owner sued the utility and waited years for trial and a settlement.

Mold Liability and Defense Costs: $10M

Due to mold exposure in a family’s apartment, a child suffered an asthma attack and could not breathe. The child was left with brain injuries due to lack of oxygen.  The apartment had a serious infestation of mold that the property manager ignored despite months of complaints.  The owner was sued due to the child’s bodily injury.  The suit settled for $9M and over $1M was incurred in legal expenses.

Remediation Expense and Business Interruption: $750,000

At a shopping center, the floor drains separated from the sanitary sewer lines.  This was discovered during renovations.  The defective sewer system caused over $750,000 in remediation costs and loss of rental income.

Remediation Expense and Business Interruption: $1M

A dry cleaner abandoned a retail space at a strip mall.  They filed for bankruptcy and left behind perchloroethylene (PERC) contamination.  The strip mall owner suffered $250,000 in business interruption costs in the form of lost rental income, and over $750,000 in costs to remediate the affected area.

Remediation Expense and Bodily Injury Liability: $375,000

While working on a lab experiment, a student dropped a thermometer accidentally spilling mercury. Unaware of the imminent danger, the students treated the spill casually, causing the mercury to be tracked throughout the school on the bottoms of their shoes.  The mercury vapors contaminated the building and students complained of nausea and headaches.  The school paid $250,000 in clean-up costs and $125,000 for bodily injury claims.

Remediation Expense: $3M

A university discovered that caulking used in a masonry building built in the 1960s contained PCBs.  The PCBs were utilized to maintain caulking elasticity.  Testing showed that the PCBs had migrated into the masonry and had become airborne in the classrooms.  The PCB laden caulk and masonry were remediated at a cost of $3M.

General Contractor - Mold

Two years after the completion of a new high school, it was determined that the window system used during construction was allowing water to infiltrate the building.  Mold was discovered. Faulty installation was part of the issue.  The cost to remediate the problem was shared by the General Contractor and the manufacturer of the windows.  The sub-contractor who installed the windows was no longer in business.  The General Contractor did not have pollution coverage for Mold and paid over $900,000.

HVAC Contractor – Legionella

Several office employees became ill from legionella.  The cause of the legionella was the improper sealing of the ducts during the installation of a new HVAC unit which allowed condensation to build up. The employees brought suit against the property owner and the contractor.

Industrial Cleaning Contractor – Contaminated Water

An industrial cleaning contractor was hired to clean a former petroleum storage tank previously used for backup power purposes.  Plastic sheeting and an associated dike were placed around the tank to prevent the runoff of contaminated rinse water.  The sheeting and dike were not properly placed around the tank allowing a substantial amount of petroleum impacted wash water to migrate onto an adjacent property.  The adjacent property owner filed suit for property damage and remediation costs related to the contaminated wash water.

Mechanical Contractor – Hydraulic Fluid

A mechanical contractor improperly installed fittings during routine maintenance of a hydraulically driven conveyor system.  A subsequent leak was not discovered until the next routine maintenance cycle.  The leaking hydraulic fluid migrated into a floor drain located beneath the equipment which discharged directly into an adjacent drainage ditch.  Property owners adjacent to the site noticed a sheen on the water in the ditch and requested an environmental investigation by regulators.  The regulators mandated clean-up of the spill and the site owner subsequently filed actions against the mechanical contractor to pay for the clean-up costs.

Painting Contractor - Lead

A child who lived in an apartment building constructed in the 1970s was diagnosed with lead poisoning. The renovation of the building by a painting contractor allegedly caused unsafe conditions for the child. The parents of the child filed a bodily injury claim against the painting contractor.  As part of the investigation of the claim, an expert was hired.  Other potential causes for the lead poisoning were discovered. As a result, the painting contractor was held liable for only a portion of the claim.

Plumbing Contractor – Contaminated Water

A plumbing contractor installing a lawn sprinkler system did not install adequate vacuum breakers on the discharge side of the water supply valves.  When pressure in a drinking water system fed by the same water main fell below atmospheric pressure, a vacuum was created which caused back-siphonage of stagnant water from the lawn sprinkler system into the drinking water supply.  Several people drank from the water supply and contracted dysentery.  Costs were incurred to investigate the issue, purge the system and to provide temporary clean water.  Suits followed alleging bodily injury.

Steel Erection Contractor – Diesel Fuel

A steel erection contractor accidently caused a release of diesel fuel at a construction site when a crane operator dropped a steel beam.  The beam landed on a small tanker truck that was brought onto the site to refuel other construction equipment.  The cost of the emergency clean-up was in excess of $55,000.

Street and Road Contractor – Diesel Fuel

A street and road contractor was hired to re-pave a 25-mile section of highway. During the project, one of the contractor’s dump trucks accidentally backed into and ruptured a mobile refueling tank.  300 gallons of diesel fuel was released onto the surface and migrated into a nearby storm drain.

Utility Contractor - Fuel Release

A utility contractor was subject to clean-up costs after vandals opened an on-site mobile refueling tank causing diesel fuel to be released onto virgin soil.

Roofing Contractor - Coatings

A roofing contractor applied polyurethane foam along with layers of elastometric protective coatings to a roof of a commercial building.  After completion of the building, workers in the building began to suffer respiratory problems caused by irritants in the coatings.  Suits for bodily injury and business interruption were filed against the general contractor and roofing subcontractor.

Spill halts operations

A contractor is responsible for fueling airplanes at a major airport.  A fueling tank hose ruptures, resulting in a 5,000-gallon jet fuel spill that covers the ground.  Contractors Pollution Liability insurance provides the needed remediation coverage, thereby avoiding a devastating loss for the contractor.

Runoff ruins wells

A paving contractor sprays an oil-based binding layer on crushed aggregate, planning to complete the asphalt roadway the following day.  A heavy overnight rain causes the binding layer to run off into the groundwater supply, contaminating residential wells.  Contractors Pollution Liability insurance pays all property damage claims and cleanup costs.

Legionella Bodily Injury and Defense Costs: $750,000

An HVAC contractor was hired to replace HVAC equipment and ductwork in a senior living center.  As a result of improper sealing of some of the ducts, condensation built up allowing legionella growth. Several residents became infected, which lead to a claim for bodily injury against the HVAC contractor amounting to over $750,000 once defense costs were factored in.

Mold Remediation and Defense Costs: $100,000

A utility contractor was hired to install a new storm water drainage system in a residential neighborhood.  When the system was installed, the contractor inadvertently left construction debris in the system.  During a severe rain event, rain water backed up in the system due to the construction debris flooding the basements of several homes.  The loss cost the contractor over $100,000 for defense costs and mold abatement in the homes.

Asbestos Remediation: $500,000

An excavation and grading contractor was hired to grade an industrial site after demolishing the existing buildings.  The property was being developed into a new shopping mall. Unknown to the contractor, the site had asbestos left in the soil from the demolition.  While grading the site, the contractor spread asbestos contaminated soil over 80% of the property.  As a result, the contaminated soil had to be removed and disposed of properly at a cost of $500,000.

Bodily Injury and Defense Costs: $75,000

A concrete contractor poured a new basement floor as part of a building remodel.  The curing agent for the concrete contained the chemical xylene.  A tenant, who entered the construction area, became overcome by fumes, fell and broke an arm.  The contractor’s General Liability policy denied coverage due to the pollution exclusion.  Their environmental liability policy paid $75,000 in medical and defense costs.

Remediation and Restoration Costs: $100,000

A concrete contractor was hired to pour concrete for a parking lot.  The re-bar that was installed prior to pouring the concrete struck a petroleum line causing a leak.  The leak was not detected immediately. Remediation and restoration expenses included the cost to remediate the contaminated site and to re-pour the concrete which totaled nearly $100,000.

Property Damage Costs and Natural Resource Damages: $150,000

A street and road contractor was building a new road along a river when a heavy rain washed soil into the river, killing fish and plants, and clogging a downstream municipal water intake.  The state determined that the contractor used inadequate soil erosion controls and he was held responsible for $150,000 for municipal water equipment replacement costs, as well as restoring the fish and wetlands.

Remediation Expense and Property Damage: $350,000

While a utility construction company was replacing natural gas meters, mercury was spilled from a meter and went unnoticed.  The family that owned the house where the work was performed found a small pool of mercury in their basement several weeks later.  The mercury had vaporized and was absorbed into their belongings stored in the basement.  The contractor was sued for $350,000 in remediation expenses to test the house and remove the mercury, as well as expenses incurred for property damage to the contents that were affected by the spilled mercury.

Professional Liability: $350,000

A general contractor sub-contracted masonry work for a warehouse project.  The masonry sub-contractor did not construct the loading dock according to the design plans.  The general contractor was accused of poor supervision and was held responsible for damages of $350,000 including costs to rebuild the loading dock.


Professional and Pollution Liability: $450,000

A construction manager oversaw the construction of an office building.  He sub-contracted the design of the heating and ventilation systems to a mechanical contractor.  The sub-contractor miscalculated the cooling needs of the building, which resulted in a $450,000 professional liability claim resulting in $450,000 in damages for replacement of the system, mold remediation, and relocation of the tenant during repairs


Contractors Pollution Liability: $1.75M

A refrigeration contractor was hired to upgrade the refrigeration system of a cold storage warehouse. An ammonia leak was caused by the failure of a valve in the system.  Seventeen neighbors were hospitalized and business operations were interrupted from the shutdown of the warehouse.  The contractor incurred $1.75M in third party bodily injury, property damage and defense costs.


Professional Liability: $350,000

A contractor provided training on the proper use of equipment that he had installed at a manufacturing facility.  A person was injured due to improper training on safety features of the unit.  A claim was filed for bodily injury and lost wages in the amount of $350,000.

General Liability Bodily Injury Claim - $40,000

A salesman came into an insured’s warehouse uninvited.  The owners told him to leave the premises. When the salesmen walked outside he reportedly faked a trip and fall in the parking lot and sued the insured for bodily injury.  While everything was caught on camera, the insured’s video was no longer available to refute the circumstances by the time the claim was received.  The insured has since installed a surveillance system that keeps recordings for one year.  He incurred a total of $40,000 in bodily injury and defense costs.


Products Pollution Coverage - $2M+

A chemical distributor purchased metal containers from an insured to supply products to their customers.  A customer informed the distributor that the seams of a number of containers failed at their facility while being moved.  The resulting chemicals were released on the customer’s premises impacting the adjacent tributary of a major river.  The container manufacturer incurred claims for remediation costs and natural resource damages due to product failure of over $2M.


General Liability Property Damage Claim - $66,500

A demolition contractor demolished a four-story, multi-family residential building in an urban area. Despite his efforts to protect the neighboring buildings, a parapet from the building being demolished broke free and fell onto the adjacent building damaging the roof, causing $66,500 in property damage.


General Liability Property Damage Claim - $17,800

An industrial painting contractor was working on the exterior of an energy plant on a windy day.  During spray painting operations, twenty-three cars in the parking lot were damaged by overspray.  The contractor incurred $17,800 in property damage to the cars in the neighboring lot.


General Liability & Excess Liability - Bodily Injury - $1.5M+

A construction inspector was on the insured’s site while an industrial process equipment contractor was installing a new valve.  The inspector climbed into a confined space to observe the installation and his chest was crushed by a heavy metal cover, resulting in a permanent physical disability.  The site owner incurred over $1.5M in costs for bodily injury and defense.



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