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Identifying Naturally Occurring Environmental Hazards
Population growth and increasing congestion along Route 26 in central Pennsylvania initiated the construction of an 8-mile highway connecting Route 322 and the Bellefonte Bypass located south of Interstate 80. Named I-99, the project was moving as planned until contractors cut through Skytop Mountain and exposed a significant amount of pyrite.
When exposed to air and water, pyrite can form low-grade sulfuric acid, which can seep into waterways and pollute surrounding areas. To date, the cost to remove the pyrite and contain the damage totals nearly $79 million.
Unfortunately, incidents like this regularly affect contractors and construction companies involved in all types of excavation and construction services. For instance, in some areas of the country, mining operations have been known to produce acid mine drainage due to procedures that expose pyrite to the atmosphere. The most notable problems occur in Illinois, Missouri and parts of the Northeast, where pyrite deposits are more abundant. Similar effects also have been produced in locations heavily mined for coal.
In addition, hazardous or toxic properties such as mercury, arsenic, asbestos and radon are commonly found during intensive excavation or road construction.
Causes and Effects
Naturally occurring asbestos (NOA) refers to minerals such as serpentenite, tremolite and actinolite. When left undisturbed and buried, these minerals present limited health or environmental hazards. However, if disturbed due to weather, mining, real estate development or construction activities, asbestos fibers can be released into the atmosphere, unknowingly exposing workers and surrounding communities to respiratory hazards.
NOA also can become an issue for construction firms performing intrusive operations. Found in nearly every area of the country, including California, which contains some of the largest naturally occurring asbestos deposits in the world, asbestos exposure has been linked to numerous illnesses such as lung cancer, asbestosis and mesothelioma.
Another highly toxic substance, mercury, is present in the environment both naturally (volcanoes, hot springs and natural mercury deposits) and as a result of human activities (metal processing, coal combustion, waste incineration, and mining at gold and cement plants).
Once in the air, mercury can settle into water and certain microorganisms, causing it to change to methylmercury. Methylmercury can then accumulate and become more concentrated as it moves up the food chain. People primarily are exposed through consumption of mercury-contaminated fish. According to the Environmental Protection Agency, mercury can impair the neurological development of infants and children in addition to damaging the nervous system and kidneys of adults.
Areas ripe for the production of methylmercury include lakes in the Northeast and North Central United States, as well as flooded reservoirs and coastal wetlands.
Arsenic, another naturally occurring element found in rock and soil, can enter air, water and land through dust and water runoff. In addition, arsenic can be released into the atmosphere by various sources such as volcanoes, mining and weathering.
However, human activities such as the burning of fossil fuels, real estate development and construction also can release arsenic. For example, naturally occurring arsenic has been found in the groundwater of almost every aquifer in Wisconsin, and a small amount of these wells actually held concentrations that exceeded suitable drinking standards. Elevated levels of arsenic have been found in Massachusetts, Michigan, New Hampshire, Rhode Island, Maine and some western states.
The long-term effects of arsenic exposure include bladder, lung, skin, kidney and liver cancer.
Of particular note for all construction firms, radon is the No. 1 cause of lung cancer among non-smokers. Radon gas formed from natural sources can accumulate in buildings, especially in confined areas such as basements and well-insulated homes. States located in the Northwest, Midwest and Northeast have the highest exposure to radon, which is becoming a primary source of background radiation.
Financing Environmental Loss
Due to the widespread occurrence of these potentially hazardous minerals, contractors throughout the country need to remain mindful of the catastrophic results that can occur when these natural substances are disturbed. Many firms have taken precautions to reduce or minimize the financial burden of such acts.
One alternative for financing environmental loss is contractors pollution liability (CPL) insurance. CPL policies are available for any type and size of contractor. They are designed to protect companies from the liability and financial loss that can result when covered operations cause a pollution incident. Coverage is provided for third-party claims for bodily injury, property damage or cleanup costs.
Policies also include coverage for vicarious liability, which covers liability arising out of the work subcontractors perform on behalf of general contractors.
When securing a CPL policy, first identify how that particular policy addresses coverage for naturally occurring substances. If the policy has a specific exclusion for losses based on or arising out of these substances, have the exclusion removed. Or, modify the exclusion so it does not apply to substances present at a jobsite due to the performance of contracting services.
Naturally occurring substances can be found anywhere and may be encountered through typical construction operations at a jobsite. All construction companies need to fully understand coverage options and the structure of existing or proposed CPL policies to protect against liability and litigation.
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Friday, September 3, 2010