Insurance agents may be more inclined to sell Pollution insurance in 2010 now that the 2008 EPA Lead Rule will become effective on April 22, 2010. Contractors performing work on buildings constructed before 1978 will be required to abide by the EPA Lead-Based Paint Renovation, Repair and Painting (RRP) Rule. The regulation creates more responsibility/awareness from the contractor in dealing with potentially hazardous areas. As a result, the contractor may incur more exposure to lead-based paint claims, which is excluded under most General Liability policies.
The RRP Rule is a federal EPA program that affects contractors, property managers, and others who disturb qualifying interior and exterior painted surfaces. Remodeling, maintenance, painting/surface preparation, window replacement, electrical, plumbing, and carpentry activities are subject to the program rules. Exceptions include emergency repair work, minor repair work that disturbs less than 6 square feet of paint per room, and housing declared lead free by a certified lead inspector. Types of properties affected by the program include pre-1978 schools, daycare centers, residential homes, and apartment buildings.*
Currently painters, electricians, GCs, carpenters, property managers, and maintenance contractors are being required to provide pre-renovation educational lead pamphlets to tenants, receive delivery confirmation, and post signs about the workplace.
Effective April 22, 2010, renovators must attend an eight-hour training course by an EPA approved training provider and the firms they work for must also be accredited. Training classes address dust and debris containment, restricting open flame burning, exhaust control for power tools and clean up procedures, record keeping, and other precautionary measures. The accreditation must be renewed every five years. Other state and local requirements may also apply and be more stringent.
Insurance Issues
The EPA is broadening renovators’ responsibilities beyond the scope of a general contractor and General Liability policy. While contractors always have a Pollution exposure, the new EPA requirements increase the risk for Pollution liability claims. The new rule requires renovators to perform lead testing, encapsulation, and cleaning activities. It also requires the contractor to educate property owners/residents about the dangers of lead and the work to be performed. (more…)
