Demolition is a high-risk job – and one of the most dangerous tasks is asbestos removal. With an estimated 200,000 global deaths attributed to this material, and 70% of them believed to be directly related to workplace incidents, the threat is clear. Contractors everywhere must ask themselves: if their staff got sick because of asbestos exposure, what would happen? For many, the answer is bleak. Delayed projects, reputational damage, and even legal disputes can all result.
This may cause you to question: Will insurance cover asbestos removal? And how can I obtain it?
Why is Asbestos so Dangerous?
Asbestos is a naturally occurring mineral composed of thin, fibrous crystals. From the late 1800s to the 1980s it was often used in construction for insulation and fire proofing. As with many hazardous materials, the threat it presented was not discovered until it had been thoroughly integrated into our lives. This means that, even today, asbestos is commonly found inside older homes and commercial buildings.
The danger associated with asbestos comes from its microscopic fibrous shards. These can easily snap off into the air, where they are inhaled. Over time, the damage caused to the victim’s lungs results in cancer or other illnesses. If left untouched, asbestos does not present as much of a threat, allowing people to live in and use contaminated buildings for many years without issue. But during demolition work, as it is moved and damaged, many fibres may snap off in a very short period of time. This means your employees are at a much higher risk of experiencing negative health effects than an ordinary citizen.
Types of Asbestos
There are six types of asbestos, differentiated mainly by their fiber structure. All of the variations listed below are either serpentine or amphibole asbestos. The former is identified by its curly, flexible fibres, while the latter’s are straight, rigid, and brittle.
1. Chrysotile (White Asbestos)
The most common type, chrysotile asbestos belongs to the serpentine group. It was widely used in roofing insulation, and is considered slightly less hazardous than other types.
2. Amosite (Brown Asbestos)
Amosite is an amphibole asbestos frequently found in cement sheets and pipe insulation. Its fibres are highly dangerous and very easily inhaled.
3. Crocidolite (Blue Asbestos)
Crocidolite has the thinnest and most fragile fibres, making them easily likely to snap off. It was used in steam engine insulation and some cement products.
4. Tremolite
Tremolite was used in paint, insulation, roofing, and plumbing materials. It appears in various colours and is toxic.
5. Actinolite
Actinolite was not widely used industrially, but has been found in some construction materials. It is composed of particularly sharp fibres that pierce lung tissue, causing severe damage.
6. Anthophyllite
Anthophyllite is the least common type of asbestos, primarily found in composite flooring and certain insulation materials. You are less likely to encounter it, but it can still pose significant health risks.
Why Do I Need Asbestos Removal Insurance?
The heightened risk associated with asbestos removal exposes your company to substantial liability. Injuries sustained as a result of asbestos are severe and often life-threatening. Without the right insurance, a single lawsuit or accident can financially cripple your business. The consequences can extend far beyond legal fees to severe and lasting reputational damage.
Other factors include:
- Environmental Liability: If asbestos contamination occurs due to improper removal, you can be held responsible.
- Regulatory Compliance: Many states require asbestos removal companies to carry specific policies.
- Property Damage: Accidental damage during removal could lead to costly repairs.
Will Insurance Cover Asbestos Removal?
Can you claim asbestos removal on insurance? The answer is yes – as long as you have the right policy. Often, you will need specialised asbestos removal insurance, as other kinds may not cover this type of work due to the increased risk involved. Exclusions, the reason for removal, and your practices and procedures can all influence whether you will be covered under a specific policy. You may also need separate insurance for environmental liability claims.
Asbestos Removal Insurance Explained
An asbestos removal policy is specifically designed to cover liability and risks associated with handling this material. It typically includes:
- All removal/demolition liability related to asbestos.
- Third-party injury and property damage.
- Worker injury.
- Legal costs, under certain circumstances.
Note that not every asbestos removal policy will cover all of these costs. It is important to check any insurance you’re considering and ensure that it suits the needs of your project.
What Happens if I Don’t Have an Asbestos Removal Policy?
Operating without asbestos removal insurance is an enormous risk. While you may have completed previous projects with no issues, this does not make it safe. In fact, it is quite the opposite: with each exposure to asbestos, your risk of a negative outcome increases. Without proper coverage, your company can face a host of severe consequences:
- Lawsuits: Clients or employees may sue for health-related claims.
- Fines & Penalties: Many states and councils require various forms of insurance in order to carry out contracts. If your company regularly handles asbestos, a specialised policy for this work will likely be mandatory. Without one, you may be subject to legal penalties.
- Out-of-Pocket Costs: Medical bills, property damage, and legal fees can be financially devastating for both you and your staff.
While handling dangerous materials such as asbestos, a single mistake can lead to long-term consequences. Investing in the right policy will ensure peace of mind, allowing you to focus on the project without worrying about what happens in the event of an accident.
What to Consider When Applying for Insurance
Not all asbestos removal insurance policies are created equal. It is essential to read and understand all details before committing to a specific provider. Consider the following:
Liability Limits
Insurance policies will only cover so many costs before they reach their cap. Ensure that your policy’s limits are high enough to handle any expenses that could harm your company. The last thing you want is insurance that costs you money while not actually addressing your needs.
Exclusions
Every policy has exclusions – that is, certain circumstances it will not cover. Some common ones include:
- Asbestos discovered before the policy start date
- Damages caused by negligence, or a failure to properly follow safety regulations
- Asbestos testing
- Environmental pollution (this is typically a separate policy)
It is essential to inspect your policy’s exclusions and check that they align with your needs.
Requirements
Each insurance policy will have its own requirements. This may include proof that you are correctly following safety procedures, a limited history of past claims, or even documentation showing adherence to legal regulations. Insurers implement these rules to protect themselves and ensure they are providing the right level of coverage. Failure to meet all requirements may result in higher premiums or outright denial.
Best Practices When Applying for an Asbestos Removal Policy
Applying for asbestos removal insurance requires careful preparation. Your provider will perform their due diligence to ensure all requirements are met before issuing coverage, so you should do the same during the application process. Some proactive steps that can improve your chances include:
- Maintain Proper Certification: Check that all relevant certifications are up-to-date, for both you and your employees. This may include an asbestos removal license, overall workplace safety certifications, and any relevant demolition licenses or certificates.
- Follow Safety Protocols: Insurers appreciate robust workplace safety procedures. Go above and beyond your bare minimum legal obligations, as this demonstrates how seriously you take safety and will improve your position.
- Document Everything: Insurers may reject your application if they are simply unsure whether you meet a requirement. Maintain written documentation of all relevant workplace procedures, certifications, and previous claims. Producing it proactively, instead of waiting to be asked, can speed up the process.
- Be Polite: This goes without saying, but a polite and helpful attitude will take you disqualify you from coverage. Provide all required information and documents promptly and without argument.
- Shop Around: You don’t have to accept the first asbestos removal policy you come across. Shop around for the one that best suits your needs.
Making a Claim
If you must make a claim to your insurance provider, fast action is crucial to minimise disruption and financial risk. Follow these steps for your best chance at securing approval:
Notify Your Insurer Immediately
As soon as an incident occurs, contact your provider and inform them of the situation. Prompt reporting will allow them to assess the claim quickly, preventing unnecessary delays. If you don’t reach out fast enough or withhold important information, your claim will take longer to process and may be denied.
Gather Essential Documentation
Collect and organise any documentation that may support your claim, including:
- Incident reports detailing what happened.
- Witness statements, if applicable.
- Photos or videos of the affected area.
- Medical reports (if relevant).
- Any communications related to the claim.
Provide these documents immediately upon request. Even better, including them with your claim may streamline the process.
Concerned about third-party claims? Read about public liability insurance
Work with Your Insurer’s Claims Team
Once your claim has been submitted, your insurer will assign a claims team to investigate the situation. They may request additional information, inspect the site, or consult with experts. Cooperate fully and provide any requested materials promptly. This will expedite your claim and improve your chances of approval.
Follow Safety and Legal Protocols
During the claims process, regulatory compliance is more critical than ever. This may be a good time to review and strengthen workplace safety procedures. If exposure has occurred, ensure that any affected individuals are receiving proper medical attention and that you are following all legal requirements. These actions will help show how seriously you are taking the incident.
Review the Settlement and Next Steps
Once your claim has been evaluated, your insurer will provide a settlement offer or notice of rejection. Review this carefully, and consult with advisors if required. If you disagree with your provider’s decision, you may have the option to appeal or negotiate.
Implement Preventive Measures
After your claim has been resolved, take steps to prevent similar incidents from occurring in the future. This may include additional employee training, updated safety protocols, or a review of your asbestos removal policy to address coverage gaps. Accruing too many claims in a short time can reduce your chances of getting approved later, so it is important to do everything you can to prevent them.
My Claim was Denied - What Now?
If your claim was denied, there are still steps you can take:
- Assess the Rejection: Read the claim rejection carefully and determine the reason for denial. This will inform your next steps.
- Provide Additional Documentation: If you have withheld information or documentation, now is the time to provide it. It may cause your claim to be reviewed.
- Appeal: If you believe the rejection was made in error, you may make an appeal. Include the reason you believe it should not have been denied, and any supporting documentation.
- Adjust Your Coverage: It is possible your current level of coverage is not sufficient for your needs. Review your current policy and whether your insurance needs to be increased to properly address risk factors.
Is Asbestos Removal Covered by Home Insurance?
When working with residential properties, there is a common question owners will ask: Is asbestos removal covered by homeowners insurance? While the answer varies by policy, most regular homeowners insurance will not cover this cost except for in very specific scenarios.
Why Isn’t Asbestos Removal Covered by Homeowners Insurance?
Homeowners insurance is designed to protect against damage to the home. This does not include planned demolition or any of the costs associated with it – instead, it usually applies to disasters such as fires or floods. Standard asbestos removal is considered part of normal demolition work, and thus the responsibility for this falls on you as the contractor.
When Will Asbestos Removal Be Covered by Home Insurance?
If asbestos removal is made necessary by a covered event, this may be an exception to the rule. For example, if a fire or storm occurs and this is covered in the owner’s regular home insurance, removal of asbestos contained within the home may also be covered. This can apply even if the policy does not typically allow for asbestos removal.
Your Questions Answered
Do I Qualify for Insurance if My Business Only Occasionally Handles Asbestos?
You can qualify for asbestos removal insurance even if you don’t handle it every day. However, because insurers evaluate risk as part of the process, this may impact the level of coverage you receive. You should apply for an asbestos removal policy if you handle it in any capacity.
How Much Does Asbestos Removal Insurance Cost?
Insurance is paid for through a monthly or annual fee called a ‘premium’. Premiums are determined on a case-by-case basis depending on your work, risk factors, and claim history.
Not quite what you’re looking for? Explore public and product liability insurance
Asbestos Exposure Leaves Your Entire Company Vulnerable - Don’t Take the Risk
Asbestos removal is a complex and high-risk job. Regular exposure can cause serious harm in the long run, both to your employees and your company. For this reason, asbestos removal insurance is an absolute necessity. Without it you risk lost finances, reputational damage, and even legal penalties, none of which will be easy to recover from. Whether you handle asbestos often or only occasionally, it is worth the effort to find a good policy that will mitigate these potential threats.
Do you need help finding coverage? TIC is familiar with the unique risk factors of asbestos removal. We know that protecting your company and employees from harm is your top priority, and that insurance is an important piece of the puzzle. If you’re ready to learn how we can assist you, get a quote today.