Indiana Supreme Court Stays the Course on Pollution Exclusion: General Liability Policies Continue to Provide Coverage in Indiana

Written By David O’Neill, Director of Investigations, EnviroForensics & PolicyFind

The Indiana Supreme Court has issued its long-anticipated decision in State Automobile Mutual Insurance Company v. Flexdar, Inc. and in so doing has re-affirmed its ruling in American States Ins. Co. v. Kiger, 662 N.E.2d 945 (Ind. 1996) that the absolute “pollution exclusion” typically appearing in commercial general liability (“CGL”) policies issued in policy periods beginning in 1986 and later is ambiguous and unenforceable as to most, if not all, types of environmental liabilities. 

Declining to take State Auto’s suggestion that it bring Indiana’s law more in line with those of other states, the Court rejected what it called “literal” as well as “situational” interpretations of the absolute pollution exclusion, opting instead to stay the course and reaffirm its prior rulings regarding the ambiguity of the exclusion. Read more »

Why You Don’t Have To Worry About Your Site Being Re-contaminated and You Can Clean-up Now

Written by Stephen R. Henshaw, President & CEO of EnviroForensics
As seen in the January 2012 issue of Cleaner & Launderer

Many dry cleaners have expressed their desire to evaluate the soil and groundwater beneath their businesses for the presence of dry cleaning chemicals, but they are concerned that if they go through a cleanup, the property could be re-contaminated down the road.

Relax, the manner in which dry cleaning is conducted today is far more protective of the environment than it was even 30 years ago.  For one, the machines designed and manufactured today are much safer than those of the past.  Secondly, the safeguards employed today, including the installation of spill containment pans beneath machines and automatic shut-offs are protective of the environment.  Finally, good housekeeping practices and the proper storage and disposal of spent solvent and filters today will greatly minimize the potential for spills and releases to enter the environment. Read more »

You Sold Your Business and You’re in the Clear…..Not So Fast

You worked hard to grow your business and you had the good fortune to sell it for a profit.  You had your lawyer look over the sale contract and you even had the buyer indemnify you for future environmental claims, should they ever arise.  You did everything right and now it’s time to relax and enjoy the fruits of your labor.

Several years pass and one day you get a letter in the mail.  The letter is sent “certified” and you have to sign for it.  You open the letter, it’s from the state environmental regulatory department informing you that as a past owner and/or operator of the sold business, you are responsible for groundwater contamination. Read more »

Flexdar Court Sides With Insureds: Reinforces Kiger; Broadens “Ambiguous” Interpretation of Absolute Pollution Exclusion Language

Written by Justin Gifford, EnviroForensics and PolicyFind General Counsel

The Indiana Court of Appeals’ November opinion in the recent State Automobile Mutual Insurance Co. v Flexdar, Inc. (Ind. App. 2010) comes as good news to business owners like drycleaners who currently or have historically used tetrachlorethene (perc) or petroleum solvents that may have been released into the environment.  The Appellate Court’s decision re-examined the landmark American States Insurance Co. v. Kiger (662 N.E.2d 945, Ind. 1996) as well as its progeny and found for Flexdar, Inc., the insured.  (Kiger established that the absolute pollution exclusion found in many general commercial liability (GCL) policies is ambiguous and, as a result, ineffective in insulating insurers from their duties to defend and/or indemnify their insureds for claims made by the Indiana Department of Environmental Management that the insureds investigate and clean up releases of perc or other substances into soil and groundwater.)  Read more »

IDEM’s Changes to TPH Procedures for Ground Water

On June 17, 2010 the Indiana Department of Environmental Management (IDEM) once again adjusted their guidance regarding the regulation of Total Petroleum Hydrocarbons (TPH) and revised pertinent sections of their Risk Integrated System of Closure (RISC) Technical Guidance Document.  A special RISC TPH Work Group has determined that the investigation, delineation and/or remediation of TPH in ground water are no longer warranted, unless protection of drinking water wells is necessary.  This development could significantly impact environmental cleanup projects where releases of petroleum products have occurred. 

The term TPH refers to an accumulation of hydrocarbon compounds that make up a variety of petroleum products.  Not all of the compounds that fall in this category have been researched individually by toxicologists, such that closure levels could be established.  Those that do have closure levels are considered Contaminants of Concern (COCs) at cleanup sites, which are commonly the more toxic compounds and are regulated individually.  The non-specific TPH is also regulated as a COC based on surrogate toxicological data.  Read more »