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Pollution Liability Insurance: Exploring the Niche Market

In the current climate, pollution liability coverage is an important niche to carry and independent agents need to monitor this niche market.
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pollution liability insurance: exploring the niche market

Much of the world is still struggling to realize that our planet is deteriorating and that there isn't much time to turn the clock back. Some of the key players in the world economy such as Hyundai, Apple, Amazon, and eBay, to name a few, have been addressing the problem, according to Forbes.

These companies have vowed to bring pollution and their carbon footprint down to zero by the end of this decade. Consumers too are waking up to the consequences of single-use plastic and are instead looking to use environmentally friendly products. 

Pollution liability insurance, a specialized form of liability insurance, ensures businesses can protect themselves against losses caused by having to defend against liability claims and the cleanup related to pollution. 

Be it small, medium or large corporations, all kinds of businesses are getting targeted for claims against environmental pollution. Earlier this year, an unprecedented claim was made against Coca-Cola, Pepsi, Nestle USA, Procter & Gamble and six other companies by The Earth Island Institute for industrial activities that contributed to creating a global pollution crisis, according to Business Insider.

Prior to the claim, Coca-Cola had been slapped with seven other such claims, while Pepsi has as many as 27 cases brought against them. The two soft drink giants have already paid almost $6 million in penalties. Large scale businesses might fare better than small scale business when they face these ordeals. But the truth is, every business is open to facing these claims.

Potential clients for pollution liability insurance include manufacturing industries, construction and chemical companies. Even so, the claims can be vastly litigious as the concerns of environmental pollution liability are fairly new. While Pepsi, Coca-Cola and other plastic producing companies are an obvious target, even businesses such as pig farms, dry cleaners and digital printing services can face pollution liability claims. 

The niche market for pollution liability insurance is very big, yet there are no standard forms or coverage. By bringing in the importance of pollution liability coverage to all business owners, independent insurance agents can acclimatize and monitor the growth of this niche market.

Radhika Mittal is a digital marketing associate at Quote Zebra.

Getting into This Niche Market

1) Is tapping into the niche profitable for me?

An independent agent needs to market newer coverage more actively towards potential leads in the first few months of carrying them. Be prepared to educate your clients before you ask them to get new insurance. 

It may be a slow breeze in the beginning, but rest assured that pollution liability coverage is an important niche to carry, especially in the current climate. In foresight, it is more cost-effective to get insured against pollution liability insurance than to stay uninsured. 

2) What does pollution liability insurance cover?

As with all niche insurance policies, pollution liability covers a small, less explored insurance market which is ideal for businesses with specific needs. The policy offers the following coverage:

  • Legal fees and settlement: Pollution liability policies cover for the costs of all legal fees, court costs and settlement amount for all claims regarding covered incidents.
  • Cleanup operations: Companies can be ordered by law to clean the environment of the pollutants. The insurance can cover costs accumulated by the cleanup operations. The policy also covers for cleaning up any property transferred to a new owner if it is contaminated.
  • Errors & omissions: Companies may wrongly declare their products and operations pollutant-free. This policy can protect companies from liability.

3) How do I promote this coverage to my prospective clients? 

Educating your clients about the benefits of pollution insurance is key. The need for such insurance coverage is growing every day in the global economy. While businesses are busy saving the world, you could be saving the businesses! As they say, not all heroes wear capes.

Monday, August 24, 2020
Environmental Liability