Products Pollution Liability Insurance: Another Bridge Spanning the Pollution Exclusion Coverage Gap

Abstract

Since the introduction of the pollution exclusion in 1970, the scope of its application has remained one of the most highly litigated insurance coverage issues. Whether construed to bar coverage for all damages caused by contaminants, or only damages caused by traditional environmental pollution, the pollution exclusion's resulting coverage gap is significant. Although some form of pollution liability insurance has been available since 1977, pollution liability coverage has not, generally speaking, been a mirror image of the pollution exclusion – reducing, not eliminating, the pollution exclusion's coverage gap. Since the 1990s, the pollution liability insurance market has grown and evolved with an increasing number of options for insureds to further reduce the pollution exclusion’s coverage gap, including products pollution liability coverage now offered by a small number of insurers.