Environmental Liabilities and Obligations: Identifying, Quantifying, Insuring, and Allocating Risk

This CLE course will review both traditional and evolving environmental insurance products, including pollution legal liability, remediation cost-cap/cost-overrun coverage, and excess of indemnity. The panel will also discuss escrows, contractual liability transfers, and other tools in the context of the cleanup, redevelopment, financing, and/or transfer of contaminated properties.

Counsel for stakeholders with interests in contaminated properties, including real estate, environmental, and bankruptcy counsel serving industrial clients, governments, brownfield developers, remediation contractors, lenders, investors, and PRP groups, can benefit from understanding how environmental risks may be identified, quantified, insured, collateralized, transferred, or retained in a manner that is accurate, efficient, and durable.

Contaminated properties present multiple financial risks: costs for unknown pollutants and otherwise unanticipated remediation; cost overruns for expected remediation; regulatory reopening or changed cleanup standards; toxic tort and other third-party claims; and transaction risks that may affect deal mechanics and certainty. Pollution legal liability insurance, cost overrun coverage, contractual indemnities, and other risk transfer tools may help parties manage these exposures, but the availability, pricing, exclusions, retention levels, and underwriting requirements vary across sites, contaminants, remedial plans, and market conditions.

The environmental risk transfer market has shifted as parties turn to insurance, escrows, captives, trusts, annuities, letters of credit, and other structures to allocate risk.

Listen as our authoritative panel discusses the various tools and mechanisms, how they are being used in current transactions, and the practical drafting, underwriting, and negotiation issues counsel may encounter.