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To the editor: Why are some members of the insurance industry spinning their wheels on developing "solutions" for problems already carefully answered?

While the Insurance Services Office's recent announcement of three endorsements to the absolute pollution exclusion in the general liability policy (BI, May 19) may help businesses with the most minimal environmental risks, these endorsements certainly don't provide the answers to most businesses' environmental exposures.

In light of the current availability and affordability of pollution insurance coverage, what kind of service are we delivering as an industry if we leave our customers in the vast "gray area" of pollution protection that the CGL policy has to offer?

The industry learned a long time ago that environmental risk could not be written like other business risks. Because of this difference, the environmental insurance industry is committed to delivering the proper environmental expertise and the highest quality service to its customers. It's a service commitment that has required delivering the environmental risk management expertise with professionals who can properly underwrite environmental risks as well as developing the insurance programs that meet the needs of individual industries at affordable premiums. With these programs often comes the environmental claims management expertise needed to service the client should an environmental incident occur.

Over the past two decades, environmental insurance has developed from a specialty niche market predominantly serving environmental companies to an increasingly important aspect of an overall insurance and risk management portfolio for all kinds of businesses worldwide.

According to a recently released ECS Underwriting report, the estimated premium growth for the environmental insurance market has increased more than tenfold, from $75 million in 1985 to between $800 and $900 million in 1995, and should continue to grow over the next 10 years. Certainly, that kind of growth rate is testimony to the effectiveness of the market's ability to insure environmental risks.

Overall, what has the insurance industry to gain from offering a partial-to say the least-pollution policy under the CGL policy? It certainly doesn't serve the insurance industry to subject our capital to a new wave of inadequately underwritten environmental exposures. Nor will it be considered a value-added service when policyholders covered by these new endorsements find themselves in courts fighting their insurance companies for pollution coverage to which they thought they were entitled.

We've been there. We've done that. And I thought the industry learned a valuable yet expensive lesson from past mistakes in underwriting environmental risks. The end result of which is an insurance industry equipped and qualified to manage the environmental risks of all businesses.

Mark Vuono

Executive Vp

ECS Underwriting Inc.

Exton, Pa.