ERP - Environmental Risk Professionals

Mold

Mold growth can result from water and wastewater releases into building materials and the subsurface due to leaks, overflows, and blocked drains or pipes. Mold may also develop in other water systems, such as refrigeration or HVAC systems and water features. Mold exposure may pose health hazards to building occupants, including severe respiratory issues and systemic toxicity, and can absorb into building materials and create cleanup liability.

Legionella

Legionella is a bacterium that causes a form of potentially fatal pneumonia. Legionella can thrive in water-containing systems like air conditioning, heating and cooling systems, and water features. It can accumulate in warm, stagnant, pooled, or infrequently- drained water. Poorly maintained systems and inadequate corrosion control or sanitization can result in Legionella growth and airborne dispersal. Exposure to third parties can result in Legionnaires’ disease, Pontiac Fever, or severe complications of existing respiratory diseases.

Asbestos

Older buildings may contain asbestos. Asbestos-containing material (ACM) may be present in duct insulation, piping, furnaces, boilers, tanks, and fireproofing insulation. ACM may also be present in ceilings, walls, flooring tile, and mastic. Tort claims may result from accidental disturbance or alleged exposure during repair work, renovation, construction, or interior remodeling.

Chemical Storage

Various chemicals and hazardous materials may be used and stored by the building owner, landlord, property manager, or tenants, including pesticides and rodenticides, cleaners and sanitizers, chlorine/bromine for water treatment, maintenance materials like paints and lubricants, and materials used by tenants in their operations. Containment breaches, spills, or improper handling and disposal can lead to environmental cleanup or create health hazards for third parties if inhaled or touched. During storage, combinations of incompatible chemicals are prone to react violently or produce toxic byproducts/gases when stored together or mixed. Some products are flammable and may result in a fire that spreads and releases other contained materials, producing hazardous vapors.

“Sick Building Syndrome”

Indoor air quality can pose environmental risks in buildings. “Sick Building Syndrome” refers to a situation where building inhabitants suffer from health problems that occur and are aggravated while in a building. Sick Building Syndrome is often attributed to poor design, maintenance, or a faulty ventilation system. Asbestos, lead, mold, and bacteria can contribute to an unhealthy indoor environment. Chemicals used and stored on-site, chemicals found in building materials, combustion products such as carbon monoxide and nitrogen dioxide, pesticides, and volatile organic compounds can also contribute to an unhealthy indoor environment. Many office products have solvents that release into the air when opened.

Chemical Pest Control Spills & Vapor Risks

Overusing or misapplication of pesticides, insecticides, and rodenticides can lead to environmental exposure. Leaks, spills, or over-application can contaminate soil, surface, or groundwater, impacting adjacent properties and stormwater run-off. Inadequate ventilation or insufficient time before building re-occupation can affect third parties with respiratory issues, headaches, nausea, or systemic toxicity.

Waste Management

Collected waste must be properly characterized and segregated based on its type and associated hazards. Wastes collected can contain hazardous materials or materials that require special disposal procedures, and improperly segregated and disposed of wastes can result in regulatory fines or lead to cleanup and environmental tort liability. Wastes may include fluorescent light fixture ballasts, fluorescent light tubes and bulbs, neon bulbs, and e-waste such as computer monitors, printers, microwave ovens, and communication equipment containing heavy metals such as lead, mercury, chromium, and cadmium.

Sewer Gases

Sewer gases can be released and migrate through a building due to dry traps, leaks, blockages, or damage to drains, vents, or pipes. Sewer gases contain compounds such as hydrogen sulfide, ammonia, carbon dioxide, methane, nitrogen, and hydrogen, and direct exposure can result in injury to the respiratory system, headaches, nausea, or in very high concentrations, even death.

Environmental 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

Both sudden and gradual pollution conditions

Aboveground and underground storage tanks

Business interruption resulting from pollution conditions

First and third-party transportation pollution liability

Mold, bacteria, viruses, legionella, and more

Loading and unloading

Defense of third-party claims

Civil fines and penalties

Illicit abandonment

Non-owned disposal sites

Claims Scenarios & Examples

After smelling strange odors in an office building, tenants eventually hired an environmental contractor to do an inspection. The contractor found Legionella in the office’s heating, ventilation, and air conditioning (HVAC) system and plumbing. Several tenants filed a claim, alleging that they had contracted legionellosis (a respiratory illness from legionella bacteria). The building owner settled with the occupants and paid to remediate the HVAC and plumbing system. Bodily injury and cleanup costs surpassed $750,000.

Occupants of an office building began to feel sick, prompting air tests to be done. Mold was found to be in the air conditioning system of the building. The building owner had to cover the mold remediation costs of $25,000 and settle the bodily injury claims for $125,000.

After a chemical spill occurred on one of the floors of an office building tower, workers were evacuated from the building, and three were sent to the hospital. Fire crews addressed the chemical release into the facility’s water treatment equipment. The chemical was identified as bromine, corrosive to human tissue, and can be extremely toxic when inhaled. The bromine was put into the HVAC cooling system along with other chemicals, Glutaraldehyde and Sodium Hydroxide, to treat the water in the system. Still, the chemicals caused a reaction in the filling process, leading to the spill. The fire crews turned off the air vents to the building as the gas entered other floors, and hazmat crews responded to clean up the spill.

Two women who worked in a medical office complained of offensive odors, headaches, itchy eyes, vomiting, tightness of the chest, and more. After two years, they finally sued the owner of the building where the medical office was located. An environmental testing firm came to the location and found various strains of mold, including black mold, water-stained ceiling tiles, and mold and yeast in the ceiling tiles inside the air intake section of the HVAC unit. Additional issues affecting the indoor air quality were also discovered, including the air conditioner not having an outside air inlet and roof drains illegally connected to the septic system, which caused sewage gases to enter the HVAC unit. It cost the owners and management firm over $100,000 to find the issue and try to fix it, and the suit sought damages over $25,000.

Residents and joggers near a creek complained of a weird odor, and a park ranger noticed an oily sheen on the surface of the creek’s water. An investigation was done, and it was found that a nearby office building’s generator had leaked 1,000 gallons of oil, which had seeped into a storm drain and the river. Remediation efforts had to be performed to clean up the oil from the creek, and it was observed that some birds were found to have oil on them and had to be cleaned off. The office building owner was found responsible and faced cleanup costs and enforcement actions, including a potential fine of $5,000 per day.

A property owner and manager of an office building hired a painter to paint the floors of the building. The painter used oil-based paint, but no kind of ventilation was provided in the process. One of the tenants of the office building complained of being overwhelmed with the fumes from the paint that circulated through the air conditioning unit. She alleged that she became ill and suffered a personal injury. The owner and manager filed the claim with their GL carrier, but the carrier denied it due to the pollution exclusion. The federal district court upheld the exclusion.

During a heavy storm, rainwater accumulated on the roof of an office building. Because of a clogged drain, the water level rose higher than the installed protective flashing, seeping into the drywall. Over time, mold grew in an obscured area and went undiscovered until people began to smell odd odors. Mold remediation became a costly cleanup for the building owners, with the potential for bodily injury claims from tenants.

A Legionella outbreak occurred at an office building due to improperly sealing ducts while installing a new HVAC unit. This allowed condensation to build up, resulting in the Legionella. Several employees became ill and brought suit against the property owner and contractor.

A commercial office building had several businesses as tenants, including a medical clinic. The medical clinic had a gas release, and the entire building had to be evacuated. Tenants could not go back to the building for several days, and several individuals experienced lung damage from exposure to the gas. The building owner faced business interruption and bodily injury claims and paid $65,000.

Property Types

Office Buildings

Environmental Exposures May Include