Industry turning to higher risk developments in prime locations

Industry turning to higher risk developments in prime locations | Insurance Business

Industry turning to higher risk developments in prime locations
Major cities in Canada are already heavily developed places – and the construction boom is only going to build them up further.

There’s a huge need for new commercial and residential developments across Canada, as well as upgrades to existing infrastructure and additional infrastructure to support the country’s growing and changing population.

But there are lots of environmental liabilities to be mindful of in the construction industry, especially for projects in built-up areas with long urban and industrial histories that might carry related potential environmental impacts.

“Given the fact that the major cities in Canada are heavily developed, owners of projects, whether they be infrastructure, commercial real estate, residential or otherwise will be increasingly looking at sites that are or may be contaminated from prior occupancies,” explained Chris Robertson, vice president, environmental and construction at Chubb Canada.

“Greenfield infill properties have been largely developed in the urban centres of Canada leaving higher risk developments in prime locations. The upside to these developments and the need for upgrades to infrastructure and new infrastructure [is that they] can result in project owners, managers, general contractors and subcontractors getting involved in riskier sites from an environmental standpoint.”

Robertson gave Insurance Business a list of environmental risks for construction industry workers and construction insurance brokers to be mindful of:
  • Exacerbation of existing known or unknown pollution conditions.
  • Remediation of known contamination.
  • Particulate from redevelopment sites, transportation to and from project sites, and works yards.
  • Disturbance of regulated materials such as lead based paint, lead in pipes, asbestos, PCB’s and others.
  • Chemicals and fuels brought on-site.
  • Underground utilities and infrastructure impacts (i.e. pipelines, sewage lines).
  • Improper selection of disposal sites for excavated fill, contaminated soil, drilling muds and slurries and other waste materials generated through redevelopment.
  • Mold growth and allegations of compromised indoor air quality as a result of faulty workmanship.

Another issue impacting construction sites is climate change or intense weather events, according to Robertson.
“Construction sites can be vulnerable to pollution events arising out of surface/storm water runoff into natural areas such as streams, rivers and lakes,” he said. “The pollutant in question is total suspended solids, which is basically muddy water, but it can affect wildlife, spawning grounds, fish farms, etc.

“As a result, Chubb has overtly listed soil, silt, and sedimentation in our definition of pollution condition to ensure our customers have the confidence that the policy contemplates this as a pollution condition.”

In Ontario, Chubb Canada is watching the proposed Management of Excess Soil guide, which is particularly relevant for development and redevelopment sites. The new guide proposes to heighten the responsibility of companies that make fill material in appropriately characterizing their soil, explained Robertson. The Ministry of Environment and Climate Change (MOECC) looks at and recognizes these large volumes of fill materials as a resource, and they are keen that the fill materials are handled, tested, and treated where required in a responsible way.

Other liability within the province may arise out of a range of laws and regulations, including the Ontario Water Resources Act, the Environmental Protection Act, and, in Ontario specifically, the Ontario Building Code and then potentially under federal regulations, such as The Fisheries Act.

“We have seen the MOECC in Ontario levy an increasing number of environmental fines related to total suspended solids in surface waters and related contraventions of the Ontario Water Resources Act recently,” he added.


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