Written by Michael Foote, Insurance Expert
Scrap metal dealers face unique environmental risks that many other motor traders do not. Fluids leaking from vehicles, improper waste storage, or accidental spillages can all cause contamination. If that pollution affects neighbouring land, waterways or public health, your business could face clean-up costs and third-party claims. Standard motor trade insurance rarely covers these risks, which is where environmental liability insurance comes in.
This type of cover protects against the financial impact of pollution and contamination claims. Policies may cover both sudden incidents, such as a spill during depollution, and gradual pollution, such as long-term leakage into soil or drains. Insurers may require you to have interceptors, bunded storage tanks, and documented waste management procedures in place before they agree to provide cover.
Legally Required Or Not?
Although not a legal requirement in every case, many landlords, councils and larger clients ask scrap dealers to hold environmental liability cover before issuing permits, contracts or leases. For dealers working with hazardous materials, depollution, or large volumes of vehicles, the protection can be critical to avoid catastrophic costs.
It’s also worth considering how environmental liability fits with other covers. For example, it often sits alongside public liability, employers’ liability, and road risk cover in a wider scrap dealer policy. Getting the balance right ensures your operation is protected from day-to-day accidents through to long-term contamination issues.
Arranging Cover
When arranging your insurance, ask specifically whether environmental liability can be added to your scrap yard insurance policy so you are not left exposed to one of the trade’s most serious risks.
