32 NEBRASKA CATTLEMAN June/July 2024 ENVIRONMENTAL LIABILITY INSURANCE IS A MUST-HAVE PEERS NCIG TODD BARTEK | FNIC SENIOR VICE PRESIDENT AND AG DIRECTOR Agriculture and, more specifically, beef production is a top performing industry for our state. With this ranking comes lots of attention and sometimes the attention is not always positive. Even in Nebraska, we see opposition to certain farming practices, resistance to specific types of agricultural operations and misunderstandings about how our food is produced. In today’s legal landscape, environmental concerns have the potential to create a host of challenges. Even when allegations are ultimately disproven, the financial toll of legal battles can be substantial. This is where Environmental Liability Insurance, also known as Pollution Insurance, steps in as a financial safeguard. Environmental Liability Insurance provides coverage for damages from pollution-related claims that are typically excluded in general liability and property insurance policies. Pollution incidents or contamination events may generate claims related to bodily injury, property damage, cleanup expenses or business interruption losses. Coverage can extend to statutory cleanup requirements, third-party claims for bodily injury and property damage, and associated legal expenses. When we think of contaminates or pollution, we tend to picture hazardous waste, and probably yellow warning labels on black barrels, which is not a part of Nebraska’s farms and ranches. However, recent case law has found cow manure to be a pollutant, not a nutrient. This classification makes manure management and proper manure handling or disposal an important task to avoid water pollution, exposure to bacteria and land degradation. Even by following Nebraska’s Department of Environment and Energy (NDEE) Livestock Waste Control Program to meet legal requirements, third party liability claims can still be reported. Furthermore, cattle producers and farmers may encounter other environmental and pollution-related risks as part of their regular operations. • Use of fertilizers and fuels in agricultural activities poses a potential threat, especially if there is overspray, misapplication or spills. • Transportation of agricultural pollutants on roads or access ways adjacent to the farm presents another risk, as incidents during transportation can lead to off-site pollution claims. • Strong odors from manure or other agricultural activities can lead to complaints from nearby residents, legal action and even health concerns, making them an environmental liability risk that cattle producers need to be aware of. • Other agricultural activities or events that could cause a public nuisance or contribute to a decrease in property values for neighboring properties may lead to economic losses and potential legal disputes. When purchasing an environmental liability insurance policy, cattle producers should consider the following key components. 1. Broad Definition of Pollutant: The policy should include an expansive and inclusive definition of what constitutes a “pollutant.” A broad definition ensures that various types of pollutants are covered, including traditional contaminants like chemicals and pollutants, as well as less conventional pollutants such as odors and pre-existing contamination like nitrates. Additionally, review the policy for pre-existing pollution liability for incidents that may have occurred before the policy’s inception. 2.Clean-Up Costs: Clean-up coverage should extend to cleanup undertakings on your premises and to off-site clean-up In today’s legal landscape, environmental concerns have the potential to create a host of challenges.
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