Hurricanes Impact the Environment

Hurricanes Impact the Environment

September 14, 2018 Business Insurance and Risk Management, The Beacon Blog 0 Comments

Last year at this time I wrote about the environmental impact of Hurricane Harvey on Texas. Now Hurricane Florence is poised to do similar damage to North Carolina.

In December two Anderson Kill attorneys, Robert M. Horkovich and John G. Nevius, published an article in Risk Management magazine on “The Environmental Impact of Hurricanes”. The article can be found online at

Horkovich and Nevius list four broad categories of environmental claims:

  1. Bodily injury and property damage liability.
  2. Environmental damage resulting in business interruption or contingent business interruption.
  3. First party property loss, including cleanup costs.
  4. Directors and officers liability for management decisions before, during and after a disaster.

Because of pollution exclusions, claims other than first party cleanup from land and water will not be covered by “standard” policies. Any business with a pollution exposure needs specific Pollution insurance. (In addition to obvious exposures, organizations with large vehicle fleets may have to contend with fluids released after flooding, or PCBs from downed transformers.)

in North Carolina, news sources have identified two specific environmental hazards: toxic waste sites owned by Duke Power and hog manure from lagoons. While claimants for the first hazard can look to a “deep pocket” for recovery, it will be harder to identify specific sources for the second (although we can expect plaintiff attorneys to be creative). Because of anticipated widespread flooding and storm surge we can expect class action suits to be filed.

Since extreme weather is increasing, the best strategy to avoid environmental claims after a hurricane or other natural disaster is to clean up toxic hazards beforehand, or at least safeguard them from causing damage.

About the Author

Harry Cylinder

Harry Cylinder, CPCU, ARM has spent nearly fifty years in the insurance industry, the majority of the time as a consultant. He has been employed by The Beacon Group of Companies since 2008, specializing in the review and analysis of property and casualty coverage forms. Mr. Cylinder has been reviewing policy forms as they have evolved over the past decades. In 2008 he published an article in the CPCU Journal which was the first description of cyber insurance coverage for a general insurance audience. Since that time he has regularly written on cyber and other topics for The Beacon Companies’ blog.