| Summary: | Universally complications exist concerning insurance cover for the risks posed
by pollution damage. Environmental insurance cover can be procured under
first-party or third-party insurance. For the latter, the polluter's statutory or civil
liability is required. The determination of liability for compensation, especially
delictual liability, remains problematic.
The right to the environment in section 24 of the Constitution creates a
general duty of care. The introduction of a strict liability regime can be
recommended to alleviate the burden of proving fault and contributory
negligence. Where there is multiple or cumulative causation or the exact
identity of the polluter is unknown, potential solutions regarding the allocation
of liability include a pollution-share, joint and several, market-share or, as a
last resort, a proportional allocation. Actionable damages should include
property damage, pure economic loss, clean-up costs and natural resource
damages, including compensation for reduced aesthetic value.
Due to the uncertainty and potential magnitude of pollution-related claims,
insurers have attempted to avoid or limit these risks by including specific
pollution exclusion and limitation clauses in policies. Statutory regulation of
policy content and prescribed wording for clauses could address problems
relating to the interpretation of policy provisions.
Various other issues such as the coverage of gradual pollution, the effect of
the various triggers of coverage and the potential long-tail liability of insurer,
the lack of information and the unpredictability of the risk cause further
complications for both the insured and the insurer. Policies should preferably
be issued on a `claims-made' basis linked to retroactive dates. Mandatory
third-party insurance to the benefit of a third party should be required within
specific high-risk industries, specifically for the benefit of the prejudiced
person or an environmental remediation fund. The right of a prejudiced party
to claim directly from the polluter's liability insurer should be introduced.
Currently, the focus appears to be more on protection and environmental
remediation than on civil compensation. There is an urgent need for the
development of statutory and civil liability compensation mechanisms and for
an increased regulation of insurance policies and practices to ensure effective
insurance cover to provide compensation for environmental damage. === Jurisprudence === LL.D.
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