Pollution insurance
Encyclopedia
Pollution insurance is a type of insurance that covers costs related to pollution. This can include the costs of brownfield restoration and cleanup, liability for injuries and deaths caused by pollution.
The largest players in this industry are AIG
, ECS/XL, Kemper
and Zurich
. One of the purposes for such insurance policies is so that when companies that cause environmental disasters go bankrupt, the victims can still be compensated. The insurance may also protect against cost overruns or regulatory changes that increase the cost of cleanup. The director of China's EPA (SEPA) has called for imposing mandatory pollution insurance on polluting industries.
According to the Cato Institute
, legal theories of joint and several liability
(e.g. under Superfund
) and requirements by courts that insurers pay to help polluters clean up their own property (regardless of the insurance contract) have hurt the pollution insurance industry; but nonetheless, the basic idea of pollution insurance remains sound. Cato claims, "With the help of insurers and risk analysts, corporate risk managers select cost-effective products and processes, which minimize the sum of insurance premiums, expected payments to victims (in excess of insurance coverage), and risk-reduction expenditures."
The largest players in this industry are AIG
AIG
AIG is American International Group, a major American insurance corporation.AIG may also refer to:* And-inverter graph, a concept in computer theory* Answers in Genesis, a creationist organization in the U.S.* Arta Industrial Group in Iran...
, ECS/XL, Kemper
Kemper
Kemper may refer to:* Booz Allen Classic , was a regular golf tournament on the PGA Tour from 1968 to 2006...
and Zurich
Zürich
Zurich is the largest city in Switzerland and the capital of the canton of Zurich. It is located in central Switzerland at the northwestern tip of Lake Zurich...
. One of the purposes for such insurance policies is so that when companies that cause environmental disasters go bankrupt, the victims can still be compensated. The insurance may also protect against cost overruns or regulatory changes that increase the cost of cleanup. The director of China's EPA (SEPA) has called for imposing mandatory pollution insurance on polluting industries.
According to the Cato Institute
Cato Institute
The Cato Institute is a libertarian think tank headquartered in Washington, D.C. It was founded in 1977 by Edward H. Crane, who remains president and CEO, and Charles Koch, chairman of the board and chief executive officer of the conglomerate Koch Industries, Inc., the largest privately held...
, legal theories of joint and several liability
Joint and several liability
Where two or more persons are liable in respect of the same liability, in most common law legal systems they may either be:* jointly liable, or* severally liable, or* jointly and severally liable.-Joint liability:...
(e.g. under Superfund
Superfund
Superfund is the common name for the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 , a United States federal law designed to clean up sites contaminated with hazardous substances...
) and requirements by courts that insurers pay to help polluters clean up their own property (regardless of the insurance contract) have hurt the pollution insurance industry; but nonetheless, the basic idea of pollution insurance remains sound. Cato claims, "With the help of insurers and risk analysts, corporate risk managers select cost-effective products and processes, which minimize the sum of insurance premiums, expected payments to victims (in excess of insurance coverage), and risk-reduction expenditures."