Consultants Errors & Omissions Liability

What does it cover?

Typical consultants errors and omissions liability policies are designed to protect environmental consultants for pollution conditions arising out of an error and/or omission from a covered professional service or services performed by or on behalf of the named insured resulting in a third-party claim for bodily injury, property damage, legal defense and cleanup.

Cost and applications:

• Premiums start at $2,500.
• Minimum deductible  $2,500.
• Limits are available from $500,000/$500,000 to $25,000,000.
• Please click here to download the Consultants Errors & Omissions Liability application.

Claim Scenarios

NOTE: The claims scenarios summarized are offered only as examples. The examples are not intended to establish any standards of care or to serve as legal advice appropriate for any particular factual situations. Coverage depends on the actual facts of each case and the terms, conditions and exclusions of each individual policy.

1. An environmental consultant performed a Phase I site assessment to identify operations using hazard materials. After receiving a clean Phase I report, the investor decided to purchase the site for development. Within a few weeks after breaking ground, hazard materials were discovered in the soil. When the land owner had to pay for the removal of hazard materials found on the site, he filed suit against the consultant for the faulty Phase I report.

Outcome - The environmental consultant paid $50,000, the cost to clean the site.

2. An engineering firm designed a pressure relief system for its' client, a coal beneficiation plant. This multi-million dollar plant was about to open when it was discovered the system the insured designed was significantly undersized. The plant did not open resulting in the loss of the tax credit, as authorized by the Clean Air Act, costing the Company millions of dollars through failure to meet the mandated deadlines. A lawsuit followed against the engineering firm.

Outcome - The engineering firm paid $15,000 for the loss of the tax credit.

3. An environmental consultant performed a Phase I site assessment at a site that had been previously used for industrial purposes. The consultant submitted a report saying that negligible contamination had been found. The property was subsequently sold. During excavation an unregistered underground storage tank was discovered on the site that had been leaking.

Outcome - The property developer sued the consultant for $1.2 million for remediation expenses, lost profits and diminution in value.

Optional coverage enhancements (but not limited to):

• Standard coverage for suits brought against an engineer anywhere in the world.
• Reimbursement of costs incurred to help reduce or avoid a claim.
• Punitive and exemplary damages coverage.
• Defense outside the limits.