ENVIRONMENTAL LIABILITY INSURANCE


With effect from March 2009,you could find yourself in hot water!

Environmental Damage (Prevention and Remediation) Regulations 2009

The Taxpayer no longer pays!

This doesn't affect me....does it?

From 1st March 2009 (England) and 6th May 2009 (Wales), if you are a private business, public sector enterprise (school, hospital) or involved in a charitable, voluntary or privately organised economic event then yes it does! Purely domestic or recreational activities are not affected.

The Environmental Liability Directive (ELD) is a piece of European legislation that is based on "the polluter pays" principle. The new Regulations supplement existing legislation and not only forces the polluter to prevent environmental damage but also to remedy the damage caused by their activities and compensate the environment.

 

What is environmental damage?

Environmental damage under the Regulations includes;

  • serious damage to EU protected species and habitats or damage to Sites of Special Scientific Interest (SSSI)
  • water contamination
  • damage to biodiversity
  • land contamination - including contamination of your own land

There is also liability without the need to show fault for activities such as activities requiring Environmental Permits, discharges to water, groundwater discharges, using pesticides, biocides or dangerous substances.

Who enforces the Directive and Regulations?

In England and Wales, the ELD competent authorities are the Environment Agency, Natural England, Marine and Fisheries Agency, Local Authorities.

What happens if I cause environmental damage?

It is your responsibility to put in place appropriate pollution prevention measures so that imminent threats and do not arise.

You must identify when there is imminent threat or actual damage and take immediate action to prevent or limit the damage.

You must notify the authorities immediately.

Enforcing authorities will decide whether, under the definitions of the legislation, environmental damage has occurred. If so, the authorities and the polluter will decide on the necessary remedial measures and complementary remediation measures (such as alternative sites to compensate for where primary remediation does not fully restore the damage) and the level of compensation required for the loss of environmental resources whilst the damage is being rectified.

How can I reduce my risk?

Insurance is not compulsory but you are advised to extend your insurance policies or take out further financial guarantees to cover any potential liabilities for damage to the environment which could run into several thousands of pounds in costs.

Your existing policy may not be sufficient. Some insurance policies currently offer "token" environmental liability cover. On further investigation, it has been shown that the cover provided falls far short of that required to fully protect you from the new Regulations.

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