According to a report from insurance broker Marsh, the percentage of clients purchasing Pollution Legal Liability (PLL) and Contractors’ Pollution Liability (CPL) policies has increased: Nearly 10 percent more PLL policies were sold in 2011 compared to 2009.

But in its “Marsh Insights: Benchmarking Trends—Environmental Purchasing Trends” report, the Marsh & McLennan Cos. subsidiary says purchasers of environmental-liability policies are buying lower limits and paying less than they were just a year ago.

Average limits have, for the most part, trended downward over the past four years, with average limits on PLL declining from $12.7 million in 2008 to $11 million in 2011. For CPL programs, limits went from $9 million in 2008 to $7.4 million in 2011.

Marsh suggests a major reason for this is that clients are no longer purchasing multiyear policies, opting for one-year policies instead.

Loss experience and claims-activity data has also “evolved,” the report says, giving insurance brokers and the insured better information on limit requirements and thereby “allowing for more appropriately structured programs.”

The report notes that deductibles have remained constant for PLL programs at around $350,000, while CPL has dropped from a high of $304,000 in 2008 to $121,000 in 2011.

Special Reports /

Environmental Insurance: More Buyers Paying Less

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