Does a Business Liability Insurance cover Environmental Damage?

Yes, however, business liability insurance has limited cover for environmental damage. It is a standard coverage.

You are insured for:

• Sudden environmental contamination that you have caused. In this case, only the damage to persons caused by the contamination is covered.
• Sudden environmental contamination caused by a defect in your product. In this case, only damage to others’ property is covered.

All other damage is not covered. Think, for example, of damage that occurs gradually, such as from a leaking transformer that pollutes the ground over the years. For these types of risks, you need Environmental Damage Insurance.