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To the editor: As someone who has followed the changes in the pollution exclusion since it was introduced, I find the new endorsements described in your May 19 article, "New CGL Endorsements Limit Pollution Exclusion," show a new flexibility by the Insurance Services Office Inc. At the same time, I agree with the critics that these endorsements do not go far enough.
The most useful of these endorsements appears to be the provision of coverage for events lasting less than 48 hours and reported within 14 days. Covering such limited events for named perils only, as provided by a second endorsement, also would be feasible. The requirement in this endorsement that a pollution event cannot be identical to another event that occurred within the past 12 months should be applicable only if the policyholder failed to take corrective action after the initial event, however.
The "specified pollutant" endorsement would appear to be the least useful of the three. It could be applied only where a policyholder is concerned about a single toxic substance, such as chlorine in a swimming pool, carbon monoxide in a heating system or use by a manufacturer or processor of a single dangerous chemical in its operations.
None of these endorsements addresses the greatest abuse of the absolute pollution exclusion, which is its application to incidents causing no damage to the environment.
No single endorsement can address every exposure. Broadly speaking, pollution risks can be divided into three categories. Those that are an integral part of a business should be covered by environmental impairment liability policies tailored to the operation they are designed to cover. Businesses with limited pollution exposures could be covered for brief, sudden and accidental events or for specified pollutants as provided in the new ISO endorsements or manuscript wording. Finally, risks with no known pollution hazards would not require any pollution exclusion except for violation of environmental laws or regulations.
I hope that the new endorsements will open the way to an era of cooperation rather than confrontation between insurers and policyholders.