Oil Insurance and Pollution Liability
When oil industry businesses purchase oil and gas insurance in New Mexico, they may think that their general liability coverage will cover pollution exposures on their covered properties and construction, but that is not the case. Umbrella and excess policies may also not cover pollution liability. A separate policy for pollution liability coverage will need to be added.
What Pollution Liability Covers
A pollution liability policy will cover any legal expenses for defense of the client in a pollution case, as well as pay for the cleaning and remediation of the pollution site. Errors and omissions for pollution cleaning companies and environmental consultants can also be included in this coverage. This type of liability coverage is important to have as environmental regulations and their enforcement is getting stricter in recent years.
The exposure to pollution liability should not be underestimated. Drilling and pipelines are usually thought of in terms of high pollution liability in the oil industry. Other allied industries are liable as well, including oil industry supply manufacturers, equipment sales, and sub-contractors out on site.
The total cost of oil and gas insurance in New Mexico will vary based on what level of liability you are taking on and a number of additional coverages needed. Talk to an insurer that is familiar with the oil industry to get more information about the insurance that will fit the needs of your business.