Contact RM Solutions About RM Solutions Main Page 		 

 :: Menu
 

Recovering Environmental Costs

Many industrial corporations have unrealised assets that have significant value. RM Solutions provides an environmental risk advisory service that can assist in unlocking this asset and maximising its value in a timely and cost effective manner. The assets are a firm’s historical liability insurance policies.

RM Solutions leads a partnership that is focused on obtaining insurance settlements.

Our “Team” consists of senior partners with the legal, environmental science and insurance backgrounds that are necessary to build a case and negotiate appropriate settlements.

Our group has developed relationships at the senior management levels of international insurance and reinsurance companies, and we know how to value and document claims so they can be resolved promptly and without litigation.

THE COST RECOVERY PROCESS WE ADHERE TO IS COST-EFFECTIVE AND DOES NOT REQUIRE A SUBSTANTIAL COMMITMENT OF MANAGEMENT RESOURCES

This claims settlement process works because:

  • Historical liability policies were written on an “occurrence” basis and do not contain an absolute pollution exclusion;
  • Most courts in the US and Canada have consistently found in favour of policyholders in many key areas of interpretation regarding pollution coverage;
  • Insurers have established significant reserves for historical environmental liabilities. Settling these claims allows insurers to release the reserves;
  • Primary insurers have reinsurance to offset these reserves. This reinsurance may be deteriorating due to insolvency or wind-up/run-off;
  • Claims are thoroughly documented and realistically valued by knowing the likely outcomes of key coverage issues.

Past and current as well as projected future environmental costs may be recoverable and while good documentation is required, this may not be as difficult as it appears because many companies are just now incurring the clean-up and remediation costs from damage that occurred many years ago.

This approach has been used successfully on a variety of liability recovery opportunities (we have case studies available for review).


STEPS IN THE RECOVERY PROCESS

Step 1
Is there a Claim?

Corporate history
  • Stock or asset purchases
  • Flow of liabilities
  • Policy rights

Liabilities
  • Past costs
  • Future costs
  • Regulatory compulsion

Policies

  • Existence/Evidence
  • Terms
  • Exclusions
  • Solvent carriers

Determine whether sufficient coverage exists to support a recovery claim
Step 2
Build the Claim
  • Provide history of corporate structure to demonstrate ownership of policies
  • Prepare analysis of each site in the claim, the nature of the problem, the proposed solution, the costs to date and the future costs expected
  • Perform allocations according to various theories to determine how much each policy/carrier should pay of the total damages
  • Complete the detailed insurance coverage chart and policy language analysis
  • Implement standstill and confidentiality agreements with each carrier
Step 3
Negotiate and Settle the Claim
  • Develop settlement strategy
  • Prepare targets and demands for each carrier
  • Hold principal-to-principal meetings with each carrier to settle the claims

Related pages:


Back to top