VERTEX was retained by an international property and casualty insurance carrier to assist them in their review and investigation of a claim made by an insured real estate developer on their environmental pollution insurance policy. The claim pertained to the Insured’s demolition of a residential apartment complex and redevelopment of the property with a new complex to include a subsurface parking garage. Soil sampling and analyses performed prior to the demolition and construction work identified pesticide impacts believed to be attributable to the historical use of the property for agriculture.
The carrier retained VERTEX to review the Insured’s analytical data, characterization of soil waste to be generated during excavation for the subsurface garage, and disposition of the soil generated (some of which required classification as a California Class I hazardous waste and disposal at a hazardous waste landfill). VERTEX’s review identified that over 25,000 tons of soil was excavated and disposed of as a California Class II Waste at a Class II facility, for approximately $1 million. However, VERTEX concluded that the limited sampling and analyses performed for this portion of the excavated soil was insufficient to justify this classification and that other options were available for the testing and disposal of this soil, that would likely have decreased the cost of disposal by approximately 50%, as the soil would likely not have required classification as a Class II waste or required disposal at a Class II facility.
The carrier used VERTEX’s report of our analysis and findings, from review of the available data and documentation, to negotiate an appropriate settlement with the Insured regarding these incurred costs, rather than paying for the full cost incurred.
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