Environmental exposures heighten risks for the healthcare industry

The coronavirus pandemic has heightened the awareness of clients and brokers to determine what other exposures may lie in their insurance programs, including within the healthcare industry. You may not know but Chubb has a Healthcare Premise Pollution Liability Policy Wording underwritten by Chubb’s Environmental Risk Team.

In Chubb’s experience, pollution related risk (especially gradual pollution) and facility-borne illnesses are typically excluded (or provide limited cover) in general liability and property policies. Bearing this in mind, Chubb’s Healthcare Premise Pollution Liability Policy was developed to provide healthcare facilities with additional insurance and to bridge some potential pollution risks that may have been overlooked or underinsured.

Environmental risk in healthcare

While healthcare facilities face environmental challenges like many large businesses, they also must address exposures specific to the industry. In Chubb’s experience, healthcare facilities come across a variety of challenges, some of which are listed below:
 

• The requirements of running a large physical plant may carry risks relating to storing fuel on-site and using chemicals and solvents for cleaning and maintenance.
• Asbestos, lead-based paint and other hazardous materials are common problems in older healthcare buildings or structures.
• New buildings may have to deal with problems stemming from mould or bacterial growth on building substrates.
• Healthcare facilities produce hazardous and infectious wastes arising from medical tests and procedures.
• As healthcare organisations seek to expand or acquire other businesses, they run the risk of acquiring environmental liabilities along with a particular property and construction activities.
• Given the strict liability exposure for medical and hazardous wastes, transportation and disposal of those materials present additional challenges.

Risk mitigation in healthcare

The critical role of healthcare organisations in our society means that they face intensified repercussions from environmental risks as people recovering from illness or injuries can be more susceptible to new health problems caused by pollution. A proactive risk management strategy can help to identify and mitigate potential pollution risks.

Obtaining the appropriate insurance coverage should be a crucial part of any healthcare organisation’s risk management strategy. Premises pollution liability policies provide coverage for many environmental-related risks in healthcare, and healthcare organisations should look to work with an insurer that has experience both in the industry and expertise in environmental risks. By addressing their environmental risks and working with the right insurer, healthcare organisations can help protect their patients and themselves.

Chubb's healthcare premise pollution liability policy wording

The Chubb Healthcare Premise Pollution Liability Policy Wording has been developed to help address the environmental risks listed above. Some of the benefits of the policy include:
 

• Coverage for first and third remediation costs resulting from premises-based pollution conditions
• Third-party liability coverage for pollution conditions resulting from premises, blanket non-owned disposal sites, transportation of waste, and off-site operational exposures on a claims made and reported basis
• Coverage for fungal and legionella exposures on a presence basis
• Option for coverage for business interruption loss resulting from pollution conditions
• Option for coverage for catastrophe management costs resulting from pollution conditions or facility-borne illness events
• Option for coverage for decontamination costs resulting from facility-borne illness events
• Coverage for emergency response costs resulting from pollution conditions or facility-borne illness

All coverage is subject to conditions and exclusions and we recommend you examine the policy wording. For instance, coverage does not include:
 

• Infectious virus, bacteria or diseases that is solely or exclusively the result of communicability through human-to-human contact. 
• Prior known pollution conditions and prior known facility-bourne illness event.
• First party property damage from a pollution condition and/or facility-bourne illness event.
• Criminal fines and penalties.

Chubb’s Healthcare Premise Pollution Liability Policy has been developed by Chubb’s Environmental Risk Team to provide cover in certain circumstances to the following categories of insureds:
 

• General medical facilities and offices
• Hospitals
• In-patient and out-patient surgical centres
• Long and short-term care facilities

For more information on Chubb’s Healthcare Premise Pollution Liability Policy, contact Chubb or your broker.