Insurance Coverage Granted for Contamination

In a recent case, the Pennsylvania Department of Environmental Protection (“DEP”) filed a lawsuit against Johnson Matthey, a manufacturer of metal alloys, contending its operations contaminated soil and groundwater.  In addition to denying those allegations, Johnson Matthey submitted the claim under its own insurance policy.

The insurance company sought to avoid covering the claim, arguing that it was only required to cover damages that “occurred” during the 12-month period in which the policy was in effect and that this contamination had “occurred” many years before the policy was issued.

The Pennsylvania Commonwealth Court found that Johnson Matthey was entitled to coverage.  The Court held that the policy applies to any “property damage which occurs during the policy period”.  Because “property damage” includes contamination, and contamination was discovered during the policy period, the Court found that the policy was triggered.

In reaching this conclusion, the Court analogized to cases in the asbestos context, in which there is a typically a long delay between one’s exposure to asbestos and the manifestation of symptoms.  In asbestos cases, all “occurrence” insurance policies in effect between the exposure and discovery of symptoms are triggered.

If you need help with an insurance claim, call our attorneys at 724-349-6768 for individual advice.

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