Scott Seaman Discusses Impact of the EPA's Regulation of "Forever Chemicals" on Insurers

Scott Seaman was featured in Law360 Insurance Authority, discussing how insurers will be impacted by the Environmental Protection Agency's (EPA) new poly-fluoroalkyl substance (PFAS) regulations, which designate certain "forever chemicals" as hazardous.

Seaman said he expects insurers to face a surge in cleanup costs at polluted sites and an increase in insurance litigation:

"In some ways, it may start a new cycle or extend an existing cycle of regulation, underlying litigation, and insurance coverage litigation. The number of large settlements and pending cases is unsettling, and it likely has only just begun."

He added there will likely be further state and federal regulations targeting additional chemicals following the EPA's regulations. Companies seeking insurance coverage may face challenges in auditing poly-fluoroalkyl substance (PFAS) exposures across multiple policies spanning different periods.

"There are still many 'big buts' associated with PFAS liabilities," he said, adding that a range of exclusions could potentially preclude coverage for PFAS claims, including those for pollution exclusions, owned property, and intentional acts. He said that dedicated exclusions for PFAS liabilities have been adopted, and policy language could continue to evolve:

"There are many things that can temper liability. There are many defenses to liability and strategies that must be employed. Causation and tracing particular injury or damage to particular defendants will present major obstacles in many cases."

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"New PFAS Rules Portend More Insurance, Superfund Suits" was published by Law360 Insurance Authority on April 25, 2024.