Property Types

Food Processing Facilities

Food processing facilities manufacture, package, label, or store food for human consumption and provide food for sale or distribution. These facilities face numerous environmental risks. Fuels for boilers and other equipment for processing foods or fleet vehicles can be stored in aboveground or underground storage tanks. Spills or releases of these petroleum products can impact on-site or off-site soil or groundwater and lead to environmental liability. Different oils (vegetable, soybean, corn, etc.) and bulk food products may be stored on-site. Releasing these materials into surface water could harm natural resources, including aquatic systems. Boilers and other equipment located on-site can produce air emissions. Refrigeration systems can involve chemicals such as anhydrous ammonia, producing a vapor cloud if released and resulting in third-party bodily injury claims. Chemicals used and wastes generated by on-site processes create environmental liabilities related to storage, handling, transportation, and disposal.

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Environmental Exposures May Include:

Petroleum Releases and Diesel Emissions
Surface Water Contamination
Wastewater Treatment and Disposal
Stormwater
Anhydrous Ammonia
On-Site Chemical Storage
Carbon Monoxide
Transport Liability and Roadway Spills
Neighboring Contamination
Mold and Moisture Intrusion
Illicit Abandoment
Vandalism

Petroleum Releases and Diesel Emissions

Gasoline, diesel fuel, or heating oils may be stored at food processing facilities. Gasoline or diesel may be used to fuel delivery trucks or other fleet vehicles, and diesel or fuel oil may be used for building heating, steam production, or backup generation at food processing facilities. These petroleum products could be stored in aboveground or underground storage tanks. Releases can occur from storage tanks, piping systems, or during loading and unloading operations. These releases can impact soil or groundwater, migrate to surface water bodies or drinking water sources, or impact indoor air through vapor intrusion. Using diesel generators or boilers and idling diesel trucks can also generate diesel particulates, which are airborne carcinogens and pose health hazards to third parties.

Surface Water Contamination

Many food products, such as oil, milk, citrus, etc., can cause fish kills and impact water quality if released to surface water bodies. Cleanup and natural resource damage claims can result from impacts on surface water bodies.

Wastewater Treatment and Disposal

Cleaning storage tanks and processing equipment may generate wastewater or sludge. Wastewater treatment systems may be present at facilities, or these waste materials may be taken to a non-owned disposal facility or wastewater treatment facility. Releases of insufficiently treated wastewater or spills could occur during cleaning, transport, or transfer from waste storage areas and create environmental risks. Improper waste disposal could lead to environmental liability or legal consequences for violating regulatory requirements.

Stormwater

Stormwater may come in contact with fueling areas, storage tanks, cleaning chemicals, bulk food storage, or solid wastes and become impacted by petroleum hydrocarbons, pollutants, or particulates. If stormwater is not properly controlled, contained, or pre-treated before discharge into sanitary or storm drainage systems, it can pollute soil and groundwater or discharge directly into surface waters, impacting human health and aquatic systems.

Anhydrous Ammonia

Refrigeration may be required for foods processed or stored. Refrigeration systems may use anhydrous ammonia, which can form a vapor cloud if released. Anhydrous ammonia, even in small concentrations in the air, can be extremely irritating to the eyes, throat, and breathing passages. Also, because ammonia boils at -28 degrees F, the expanding gas can potentially freeze human flesh. Therefore, a release could result in third-party bodily injury and property damage claims. Other chemicals used for refrigeration are often ozone-depleting substances. Releases of these can result in civil violations if not properly addressed.

On-Site Chemical Storage

Chemicals may be stored on-site for food additives, disinfection, equipment degreasing, or pest or rodent control. Spills or leaks from chemical storage areas could cause environmental risks, such as impacts to soil or groundwater or migration of contaminants in stormwater to surface water, causing damage to aquatic life or degradation of water quality.

Carbon Monoxide

Air emissions can emanate from boilers, vehicles, and powered equipment, such as forklifts, trucks, and cranes, which may be used at the manufacturing facility. Boilers and internal combustion vehicles are often powered by diesel or propane, which can emit carbon monoxide gas, leading to permit violations or third-party injury claims.

Transport Liability and Roadway Spills

Accidental releases during transportation of fuels, chemicals, or food products to or from a food processing facility due to improper cargo securement, a loose valve, or vehicle upsets or overturns can result in claims for cleanup of the roadway and for soil, groundwater, or surface waters impacted by a release. Also, third-party claims could result in bodily injury or property damage from a release. Trucks loading and unloading at these facilities can also leak fuel or automotive fluids that could migrate or collect in stormwater.

Neighboring Contamination

Many manufacturing facilities, such as food processing plants, are in industrial areas. Contaminants from neighboring facilities could migrate to the food processor’s property. If the neighboring business owner is not properly insured or goes bankrupt, the cost of cleanup on-site could fall on the food processing facility. Additionally, the food processing facility could be drawn into third-party bodily injury and property damage claims related to contamination migrating beneath their site and impacting third parties.

Mold and Moisture Intrusion

Mold can develop from moisture intrusion due to storms or flooding from leaking water pipes, sprinklers, and HVAC systems. Many manufacturing buildings are flat-roofed, where pooled water can be absorbed by the roofing material and seep into sub-roof areas. Exterior insulation finishing systems can develop mold behind the exterior finishes. Additionally, mold can develop within HVAC systems or from improper building ventilation or humidity management of climate-controlled areas within the building. These mold conditions can lead to cleanup costs.

Illicit Abandoment

Illicit abandonment is the illegal dumping of pollutants on a property by a third party. It can become the burden of the facility owner for cleanup and third-party bodily injury or property damage if law enforcement cannot find the originator of the waste.

Vandalism

If there is inadequate security at a facility, vandalism can occur. Damage to facility equipment, including, for example, aboveground tanks or containers of chemicals, can result in environmental releases.

Contractors Pollution Liability 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 bodily injury and property damage

Third-party claims for cleanup costs

Both sudden and gradual pollution conditions

Defense of third-party claims

Emergency response costs

Natural resource damage

First and third-party transportation pollution liability

Loading and unloading

Business interruption resulting from pollution conditions

Aboveground and underground storage tanks

Non-owned disposal sites

Crisis/reputation management

Civil fines and penalties

Mold, legionella, and more

Illicit abandonment

Claims Scenarios & Examples

The refrigeration system for a food processing and refrigeration warehouse uses aqueous ammonia. A valve on the ammonia storage tank was damaged, resulting in a release of aqueous ammonia. The release caused an evacuation within a one-mile radius of the facility. There were inhalation-related injuries to seventy-five people and damage to food products loaded on trains for delivery. Five people were sent to intensive care for complications related to lung damage. The property damage costs and bodily injury and defense costs exceeded $1 million.
A poultry processing facility had a pipe failure that released over 200,000 gallons of insufficiently-treated wastewater to a nearby river. The spill resulted in a fish kill, impacts on the ecosystem, and degradation of the water quality. The state sued the company to recover damages for the loss of species, natural resources, and public use of the resources. One person filed a third-party bodily injury suit related to the spill. She was hospitalized with sepsis allegedly caused by E. Coli bacteria she ingested from drinking water drawn from the river after the spill. Also, forty property owners along the river sued the company for third-party property damages.
Aboveground storage tanks and associated below-ground fuel piping were present at a manufacturing facility. A slow leak over time from the underground piping resulted in a release of fuel that contaminated both on-site and off-site soils and groundwater. Cleanup and attorney costs totaled $3.4 million.
A seafood processor in Alaska was found to have violated the Clean Water Act. The company had discharged fish entrails, blood, oil, and other byproducts at levels above permit limits, resulting in a seafood waste pile at its discharge pipe that was more than double the one-acre limit in their permit. The company was required to install new treatment technology to decrease the volume of seafood waste discharged, monitor the seafood pile, and perform an extensive assessment of environmental impacts caused by the pile. The company paid a $82,500 civil penalty in addition to the costs to implement the EPA’s requirements.
A former food processing facility was being sold. Environmental due diligence by the potential buyer discovered past use of chlorinated solvents on-site. An environmental site investigation discovered trichloroethylene contamination in soil and groundwater. The former owner was liable for the cleanup of the on-site contamination.
An unknown party illegally placed a container of hazardous liquid waste into a dumpster at a small food processing facility. The container leaked and contaminated the contents of the load, which in turn, contaminated the waste on the tipping floor of the transfer station. Cleanup costs and legal fees exceeded $150,000.
A food processing facility generated grease as part of its operations. The grease was collected by a third-party disposal company, which illegally dumped the grease into the municipal sewer system. The grease clogged the sewer piping system causing odor complaints and sewer backups. The disposal company went bankrupt, and the food processing facility and other generators became liable for the resulting third-party claims.
A milk pasteurizing facility was transporting its product by tanker truck to another food manufacturing facility. On route, the truck had a rollover accident that resulted in the release of milk to the roadway and to stormwater drains that discharged the milk into a nearby stream. The milk caused a fish kill in the stream. The pasteurizing facility was responsible for paying cleanup costs and natural resource damage claims.
The US Environmental Protection Agency (EPA) brought a lawsuit against a food and beverage products supplier for leaking an excessive amount of ozone-depleting chlorofluorocarbons from their refrigeration equipment. The company’s equipment had developed a leak that went unaddressed for an extended period. A settlement was reached for $170,000 between the EPA and the company.

Final Consideration

Your business can be faced with the cost to defend itself against allegations or legal action from pollution related events, regardless if you are at fault or not. Having the proper insurance coverage in place will help fund the expenses incurred to investigate or defend against a claim or suit and provide you with environmental claims handling expertise.

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This environmental risk overview offers a general understanding of potential risks and may not reflect all risks associated with your business. Environmental Risk Professionals has compiled this overview for informational purposes only. This overview does not constitute legal opinion or advice, nor does it establish a consultant-client relationship. This overview is not intended to guide project parties in interpreting specific contracts or resolving disputes; such decisions may require consultation with counsel and depend on various factors. © 2025 Environmental Risk Professionals, LLC