Business Liability – Pollution Coverage Claims

With the rise of PFAS contamination, businesses may be charged with the environmental cleanup and associated costs. Business owners may wonder if insurance might cover some or all of the costs.

Business General Liability Coverage

Companies with general liability coverage may have policies that include pollution coverage. Under this coverage, it may be possible to file a claim if environmental cleanup is required.

Business Liability Umbrella Coverage

Business liability umbrella coverage may also provide coverage for pollution cleanup. It may be possible that umbrella coverage can apply to environmental cleanup situations.

Filing a Claim For Coverage

Filing a claim for required environmental cleanup may present challenges. The wording of the policy may seem to cover the cleanup, but denied claims may have to work through the legal process. If your business experiences problems with filing a claim, don’t lose hope. There may be legal options to challenge the insurance company’s decision. Below is a similar situation in New Jersey courts.

PFAS Cleanup Coverage Lawsuit

Shamrock Technologies is a company with locations in several states, including New Jersey. In 2019, the Kentucky Department of Environmental Protections found PFAS contamination caused by Shamrock and required the company to clean it up. Shamrock has insurance coverage it believes applies to this situation.

Shamrock contacted their insurance company to file a claim for coverage. The company had general liability coverage and an umbrella policy with Illinois Union. But Illinois did not make a decision on the coverage. To avoid further problems with the state, Shamrock implemented the state’s cleanup plan at its own cost.

Breach of Contract and Bad Faith Claim

In 2024, Shamrock Technologies filed a legal claim against Illinois Union for breach of contract based on the wording of the policies. Additionally, there is a bad faith claim because Illinois Union took 15 months to respond to Shamrock’s initial notification. Shamrock’s lawsuit is seeking coverage for the environmental cleanup costs with interest, plus attorney’s fees and costs. As of January 2025, the case was still pending.

Business Insurance Bad Faith Law Firm

Kane & Silverman is a trusted business insurance bad faith law firm in Pennsylvania and New Jersey. If you have questions about a business insurance claim that has been denied, one of our attorneys may be able to help. Contact Kane & Silverman today to schedule a business insurance bad faith consultation.