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5 Insured section D - Pollution liability

5.1 Pollution liability
The insurer agrees to indemnify the insured by the terms of this insured section against
legal liability to pay damages or compensation, including claimant costs recoverable from the
insured arising from personal injury, damage, denial of access or nuisance occurring in
its entirety during the period of insurance arising out of or from pollution, provided that
such pollution:
a) arises solely out of the course of the business; and
b) is the direct result of a sudden, specific and identif iable event occurring during the
period of insurance.

5.2 Pollution liability defence costs

5.2.1 Except for any matter relating to North American jurisdiction, the insurer agrees to
indemnify the insured for defence costs which are payable in addition to and do no t count
towards the limit of indemnity.
5.2.2 Where payment exceeding the limit of indemnity has to be made to dispose of a claim, the
insurer’s liability for defence costs shall be limited to such proportion of the said defence
costs as the limit of indemnity bears to the total amount paid to dispose of the claim.
5.2.3 This indemnity is subject to the exclusion ‘Defence costs incurred without the insurer’s
consent’.
5.3 Pollution liability extensions

5.3.1 Environmental statutory liability
The insurance provided by this insured section is extended to indemnify the insured for all
sums, including statutory debts, that the insured is legally liable to pay or legally obliged to
incur for remediation in respect of environmental damage where such liability arises under
an environmental protection directive, statute or statutory instrument, provided that:
a) liability arises from pollution occurring during the course of business, within a state of
the European Union and is caused by a sudden, identifiable, unintended and
unexpected incident that takes place in its entirety at a specific moment in time and
place during the period of insurance;
b) the insurance by this extension excludes and does not cover any sum incurred in respect
of:
i) preventative costs for prevention of imminent threat of environmental damage;
ii) primary, complementary or compensatory remediation for damage;
iii) the removal of any significant risk of an adverse effect on human health;
to or on the insured’s land, premises, watercourse or body of water whether owned,
leased, hired, tenanted or otherwise in the insured’s care, custody or control;
c) the insurance by this extension excludes and does not cover any sum incurred in
achieving any improvement or alteration in the condition of the land, the atmosphere or
any watercourse or body of water beyond that required under any relevant and
applicable law or statutory enactment at the time remediation commences; and
d) the total amount payable by the insurer inclusive of all defence costs for any one
occurrence or in the aggregate during any one period of insurance shall not exceed the
sub-limit of indemnity as stated in the schedule (but if no sub-limit is shown in the
schedule the amount of the sub-limit shall be GBP 5,000,000);
and provided also that the exclusion in proviso b) i) above shall not apply to preventative
costs that are incurred with the insurer’s written consent that must be obtained prior to
each claim, where a pollution event is taking place or has occurred and such preventative
costs relate solely to halt or limit further pollution to third party property except that nothing
in this clause shall imply that the insurer will indemnify the insured for preventative costs
relating to the insured’s own land, premises or watercourse or body of water.

PPBL010121 Public Authority Combined Liability Insurance Policy (UK) Page 14 of 48