Pollution Exclusion Commercial Auto Policies

The auto liability section of the standard commercial auto policy contains broad pollution exclusion. The pollution exclusion applies to bodily injury or property damage that arises out of the discharge, release or escape of pollutants. It consists of the following:

  • Pollutants being transported by you or on your behalf
  • Pollutants being loaded onto, or unloaded from, a covered auto
  • Being stored, disposed of, treated or processed in or on a covered auto

How a Pollution Exclusion Affects You

Many more businesses than you realize are prone to losses to pollution liability resulting from the use of their vehicles. Contractors will often have a tank mounted on their vehicles to contain their cleaning solutions. For the purpose of this discussion, we will define “pollutants” as any solid, liquid, fumes, acids, alkalis, chemicals, and waste.

Let’s say your vehicle is involved in an accident resulting in damage to the tank that is mounted on it. The tank is cracked and the liquid leaked into a nearby creek or reservoir, killing much of the fish and plant population. Due to this, a pollution claim is filed by the municipality stating your company is responsible for cleaning up the water and restoring the fish and plant life back to a suitable level. You immediately call your insurance agent to report the claim and seek coverage under your auto policy. The agent informs you the auto policy doesn’t offer such coverage, so you turn to your General Liability policy only to learn the same news.

The point of this example is to advise you that just about anything can be considered a “pollutant”. This spill did not have to occur near a creek or reservoir. It could have happened in a residential street and gone into the sewer system or could have damaged someone’s lawn. Since many power washers are carrying some sort of chemical or cleaning solutions.

Where would this coverage come from to protect your business?

A Commercial Pollution Liability policy would cover this type of loss. The minimum premium for this type of coverage is approximately $1,500. If you are interested in a quote, please us a call at 1-800-878-3808 today.

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