Fluid Releases
Fluids, such as motor oil, hydraulic fluid, engine coolant, gasoline, or diesel fuel, can leak from stored equipment or be accidentally released or spilled from drums or other containers during repair or maintenance. Releases can enter floor drains, flow onto unpaved areas, or collect in stormwater run-off, leading to soil, groundwater, or surface water contamination or impacting nearby third-party properties. Drinking water sources or natural resources could also be impacted.
Fuel and Chemical Storage
Fuels, maintenance chemicals, or waste fluids may be stored in aboveground or underground storage tanks. Improper management or monitoring of tanks can lead to leaks or spills into the environment. Tank pipes or valves can also rupture or leak and impact the environment. Furthermore, spills can occur due to overfilling of tanks or during loading or unloading.
Paints
Equipment dealers may perform painting operations and generate paint and associated solvent wastes. If not properly managed, paints or solvents could be released, migrating to floor drains, storm drains, soil, or groundwater. Paint spray operations generate toxic vapors, which, if not controlled, could lead to air emissions violations or third-party bodily injury or property damage claims.
Hydraulic System Leakage
Hydraulic lifts may be present and can be either below or aboveground. Releases of hydraulic fluid below ground can go undiscovered for long periods and impact soil or groundwater. Releases or leaks from aboveground lifts can enter floor or storm drains or migrate to unpaved facility areas.
Stormwater Run-off
Outdoor storage and maintenance areas can come in contact with stormwater. Stormwater run-off can collect pollutants; if not properly controlled, the contaminated run-off can discharge into sanitary or storm drainage systems. It can pollute soil, groundwater, or surface waters, impacting human health and natural resources.
Oil Water Separators
Oil water separators may be present at an equipment dealer facility. They receive oily wastewater, and if not properly maintained, it can leak or overflow, impacting soil or groundwater or discharging oils to sewer systems or surface water bodies.
Equipment Wash Water
Some equipment dealers may have washing facilities. Wash water from cleaning equipment may have high levels of oil, grease, suspended solids, heavy metals, degreasing solvents, or detergents. Wash water needs to be properly contained and disposed of off-site or treated before discharge to prevent pollutants from being discharged to storm drains or sanitary sewers at unacceptable levels.
Flammables
Some products stored at equipment dealer facilities may be flammable, such as paint thinners, strippers, waste paint, solvents, and saturated shop rags. A fire could emit toxic fumes and smoke from the burning materials or a mix of materials due to the fire. Tires stored on-site are a particular concern in a fire due to the toxic materials in tires, the production of significant smoke when burning, and the difficulty of extinguishing tires on fire. Firefighting solutions, such as water and foam, could create contaminated run-off that impacts soil or groundwater on or off-site or migrates to surface waters.
Batteries
New and used batteries may be stored at an equipment dealer’s property. Damaged batteries could release sulfuric acid and lead, contaminating soil or groundwater or entering floor or storm drains, impacting sewer systems or surface waters.
Waste Management
Repair and maintenance facilities for equipment generate and dispose of waste, such as used oil, maintenance fluids, lead-acid batteries, sludge and oil from oilwater separators, waste paints, solvents, oil-contaminated rags, and absorbents. Waste generators must determine if their wastes are hazardous and require special disposal or recycling procedures. Improper characterization and disposal can result in environmental liability. Waste generators retain “cradle to grave” liability for their disposed of wastes and can become Potentially Responsible Parties for cleanups at non-owned disposal sites (NODs).
Loading and Transit Releases
Transport of waste materials by the owner or third-party carriers to NODs or recycling facilities or transport of materials used for equipment maintenance at customer sites can lead to environmental liability for spills or leaks during transit or while loading or unloading.
Off-Site Maintenance Releases
During repair or maintenance of equipment performed at customers’ properties, spills or leaks of maintenance chemicals, waste oils, or other fluids may occur. These releases could impact soil or groundwater, or pollutants could migrate in stormwater to surface water bodies, leading to cleanup, third-party bodily injury or property damage, or natural resource damage claims.
Water Intrusion and Mold
Water intrusion may occur at an equipment dealer’s facility due to storms, flooding, or leaks from water-containing systems such as washing facility water pipes, fire sprinklers, HVAC, and plumbing. Improper building ventilation can lead to humid conditions in a building. Water intrusion or humid conditions can lead to mold growth in the building structure and environmental liability for cleanup and third-party claims.
Environmental Liability Insurance Can Provide Coverage For
On-site cleanup of new and pre-existing pollution conditions
Off-site cleanup of new and pre-existing pollution conditions
Third-party claims for cleanup costs
Third-party claims for bodily injury and property damage
Both sudden and gradual pollution conditions
Defense of third-party claims
First-party and third-party transportation pollution liability
Business Interruption expenses resulting from pollution conditions
Mold, bacteria, legionella, and more
Natural resource damage
Emergency response expenses
Illicit abandonment
Non-owned disposal sites
Loading and unloading
Civil fines and punitive damages, where allowed by state law
Aboveground and underground storage tanks
Off-site services pollution liability