Alert
AIG Exits PLL Market
January 2016
AIG announced internally that they are exiting the SiteSpecific Pollution Liability (PLL) market effective immediately.
There has not yet been a formal, external announcement to
the marketplace. In speaking with senior AIG Environmental
personnel, Willis Towers Watson Environmental has the
following information at this time:
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No new business will be quoted effective immediately for
the U.S. and Canada.
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Open PLL quotes for new business and renewals will be
honored up until the expiration date of same (generally 30
days from the quote date).
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Extensions (typically 30-60 days) for expiring/renewal
policies may be considered based on individual
circumstances.
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Extended reporting periods (ERP) and other policy terms
and conditions within in-force PLL policies will stand. It is
reasonable to expect that full ERP fees will apply if such an
extension is requested.
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In-force PLL accounts will be notified of AIG’s intent to
non-renew. As such, alternative markets will have to be
considered for renewal terms.
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Coverage will reportedly continue to be available for risks
outside of the U.S. and Canada via AIG underwriting offices
outside the U.S. and Canada. However, those offices will
not be extending coverage to U.S. or Canadian locations.
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Long-term PLL policies currently in force will likely be
moved to a run-off facility but will reportedly continue to be
managed by AIG Environmental underwriters for mid-term
servicing needs such as location additions/deletions.
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Consideration may be given to cancelling in-force, longterm PLL policies. However, the possible waiver of
minimum earned premiums will be addressed case by case.
AIG will continue to write Contractors Pollution Liability
(CPL) business, combined GL/PLL (EAGLE) business, and
Underground Storage Tank (UST) liability business. These
lines will continue to be handled by AIG Environmental
personnel. However, if there is PLL coverage tied into one
of these products (e.g., separate policy with linked limits
or “side-car” via endorsement), it is very likely that these
extensions will not be renewed.
Obviously there is quite a bit to iron out here, and Willis
Towers Watson is actively working to address this
unprecedented situation with our clients. It is most important
that we work together to assess the best possible approach
to the unique elements of each client’s individual PLL
program. Now is not a time for hasty actions. Despite a
robust PLL marketplace, AIG has historically written more
challenging risks, in a wide variety of business classes. Thus
the appetite for same may or may not exist in the market.
In addition, achieving the exact same terms, conditions and
rates may not be viable. However, Willis Towers Watson and
its Environmental Practice maintain very strong relationships
with all of the major carriers in the PLL product line space
and are dedicated to achieving the best possible outcomes
for our clients. We have the depth and breadth of resources
and expertise in our practice to offer strong alternatives.
Contact
If you have any questions, please contact your client service team or
feel free to contact me directly.
Richard M. Sheldon, Jr., ARM
Environmental Practice Leader/Head of Environmental Broking
Willis Towers Watson
T +1 610 254 5625
M +1 610 639- 416
The observations, comments and suggestions we have made in this publication are
advisory and are not intended nor should they be taken as legal advice. Please contact
your own legal adviser for an analysis of your specific facts and circumstances.
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