Pollution Legal Liability (PLL) “Borrower” or “Site-Owner”Pollution Legal Liability policies, also known as “borrower” or “site-owner” policies have been around for nearly 30 years and have come a long way in the types of coverages offered.
PLL policies are recognized by the EPA, state and local governments as well as Fortune 500 companies as a valid way to transfer liability and to secure financing on environmentally challenging properties. Some states even subsidize the cost of purchasing such policies to encourage the development and financing of Brownfield properties.
Coverages – For Site-Owner and Others
Coverage is primarily for the site owner but others including lenders, equity partners and other interested parties can be added to the policy as additional Insureds.
- On-site cleanup costs
- Off-site cleanup costs (migrating from or to the collateral property)
- Third party Bodily Injury and Property protection (diminution in property value)
- Legal Defense
- Other coverage “add-ons” depending on the circumstances – including mold, lead and asbestos
- Policy premiums are typically higher than lender policies and require higher deductibles and sometimes more exclusions
Applications & Benefits – Site Owner Policy
- Time effective – quotations within a 1 week possible
- Replace Phase I
- Replace Phase II
- Replace personal indemnification
- Transaction grease in purchase and sales and mergers and acquisitions
- Legacy coverage – due to strict liability – divesting a property doesn’t mean you cannot be held liable for future claims
- Reopener coverage – change in law or discovery of new conditions
- Can cover existing contamination in certain circumstances: i.e. in Risk-Based states certain levels of contamination are acceptable but might not be in the future or that existing contamination could get worse – requiring remediation 10 year policy coverage
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