Pollution

Insurers in California need to change the way they investigate and adjust claims involving pollution. Where they had quickly and blithely denied claims where injuries to person or property was claimed as a result of exposure to toxic substances, they must now thoroughly investigate the claim of the insured and determine if the effect of pollutants was an "ordinary act of negligence" or a widespread pollution of the environment.

 

The California Supreme Court has, unanimously, in John R. MacKinnon v. Truck Insurance Exchange, 31 Cal.4th 635, 73 P.3d 1205, 3 Cal.Rptr.3d 228 (Cal. 08/14/2003), concluded that the "pollution exclusion" of the Commercial General Liability ("CGL") policy "does not plainly and clearly exclude ordinary acts of negligence involving toxic chemicals such as pesticides." Insurers doing business in California must, as a result, reevaluate denials of claims based upon the pollution exclusion and should withdraw those denials and provide coverage for defense and indemnity in those cases that fall within the Supreme Court’s definition.

 

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