Hazardous Waste: The Cost and Availability of Pollution Insurance
PEMD-89-6
Published: Oct 28, 1988. Publicly Released: Dec 21, 1988.
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Highlights
Pursuant to a congressional request, GAO reviewed the availability of pollution liability insurance for owners and operators of hazardous waste facilities, specifically: (1) changes in financial responsibility mechanisms since 1982; (2) how the number of insurance companies offering pollution liability insurance had changed since 1982; and (3) how the insurance industry determines risk and sets rates for pollution liability insurance and how sound those methods are.
Recommendations
Matter for Congressional Consideration
| Matter | Status | Comments |
|---|---|---|
| Congress may wish to consider authorizing EPA to collect the appropriate information to assess the reasonableness of the costs of insurance to meet EPA liability coverage requirements. Such information would include premiums and additional costs to the insured operator, underwriting expenses for the insurer, and any limitations to the financial protection afforded under the insurance contract. | The requesting committee has considered this recommendation. |
Recommendations for Executive Action
| Agency Affected | Recommendation | Status |
|---|---|---|
| Environmental Protection Agency | EPA has recently expanded the number of financial mechanisms that hazardous waste facility owners and operators may use to demonstrate financial responsibility. EPA should carefully monitor the effects of this additional flexibility on the number and size of operations using noninsurance alternatives to determine if it does not have the intended effect of reducing the problem created by the constrained insurance market. |
EPA is monitoring the effects of more flexible liability regulations.
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Topics
Hazardous substancesIndustrial accidentsIndustrial pollutionIndustrial wastesInsurance companiesInsurance cost controlInsurance premiumsInsurance regulationLiability insurancePollution control