It’s been more than three years since a series of devastating wildfires ravaged southern Colorado, but the risk of flash flooding and mudslides is still very real, a news report from local station KRDO suggests.
A meeting was held Monday evening for residents near Colorado Springs and Manitou Springs to help them prepare and minimize the risk of severe flooding. In July 2013, residents learned of the threat firsthand when flooding and mudslides flowed down Highway 24 when the ground – seriously damaged by wildfire – could no longer absorb the rainfall.
“An inch of rain, or half an inch of rain on the burn scar over a short period of time, can cause extreme flooding like we’ve seen over the last few years,” said Sallie Clark, the District 3 Commissioner for El Paso County.
In the wake of this ongoing threat, many businesses have prepared by taking out flood insurance policies and revisiting property coverage. For many, however, this isn’t their only exposure.
Severe weather events can also cause serious environmental liabilities and high monetary consequences for clients without proper insurance coverage. Flooding in particular can damage above-ground storage tanks that contain contaminants, releasing them into the environment and creating a pollution event.
Floods can also result in mold growth, as was seen in the aftermath of Hurricanes Katrina and Irene.
Owners of involved facilities will be liable for this kind of fallout. Such incidents are not covered under traditional liability policies, necessitating an environmental liability insurance policy for fixed facilities or contractors pollution liability policies for contract workers.
And this is just as true for more “mainstream” businesses like laundromats or restaurants as it is for firms with obvious environmental exposures.
“You don’t have to be in the pollution business to have a claim,” explains insurance carrier R.E. Chaix on the company blog. “It has been our experience that in the event of a serious claim, the injured parties will file a lawsuit against all parties, which can lead to legal fees, even if you are not the party responsible.”
Environmental insurance is an increasingly important coverage for commercial clients thanks to these circumstances. And offering it also protects insurance agents.
“We encourage all our brokers and agents to review exposures with their clients and present environmental/pollution liability options as part of your annual planning,” R.E. Chaix said. “By doing so, it will reduce your E&O exposure in addition to increasing your professional standing with your client.”
