Qualifying & Estimating Environmental Damages:
How and when are policies triggered?
Losses to businesses or insurers from asbestos, environmental, and health hazards are inherently uncertain due to the long-term nature of such potential exposures. However the uncertainty can be mitigated by better understanding the damages and by understanding when and how much insurance will be triggered. This is accomplished through site evaluations, identifying all potential damages, and estimating future damages. For example, ongoing screening is done during site evaluations to determine when environmental damage (both historic and potential future) meets the definition of recoverability. These actions will ensure that companies and insurers alike know what potential costs will be and how they will be allocated.
Experts from Bates White and Environ demonstrate that for the typical policyholder facing potential environmental damages, our process and experience allows the insurer or policy holder to manage their risk moving forward.
Quantifying Nonproduct Losses:
How and when were claimants exposed?
Which claimants’ exposure to asbestos occurred during business operations and which claimants’ exposure occurred afterwards? The answer to this question may determine if the policyholder’s insurers owe tens of millions, hundreds of millions, or billions. If a claim is determined to be a “products” claim, such that exposure did not occur during the policyholder’s contracting operations, then insurance recoveries will be subject to the explicit aggregate limit specified in each insurance policy’s products and completed exclusion clauses. In contrast, if a claimant claims exposure during the policyholder’s operations, then the claim may fall outside exclusion clauses (such as a “nonproducts” claim) and the amount of insurance recovery may not be subject to an aggregate limit.
Experts from Bates White and Environ demonstrate that for the typical policyholder with contracting activities, a minority of its claimants were exposed while contracting activities were ongoing; the majority of claimants were exposed long after the contracting activities were completed. They provide concrete examples.