Environmental insurance, also known as pollution insurance or pollution coverage, provides coverage for loss or damages resulting from unexpected releases of pollutants that are typically excluded in general liability and property insurance policies. Environmental insurance policies are designed to protect insureds against claims for bodily injury, property damage, cleanup costs, and business interruption. Environmental insurance also provides coverage for risks connected to historic contamination or operational issues, such as mold, lead paint, asbestos, Legionella, or indoor poor air quality.

Environmental insurance is important because standard general liability policies exclude most pollution losses, with very few exceptions, such as from smoke from an out-of-control fire or fumes from a faulty heating or air-conditioning system. Environmental insurance helps cover pollution legal liability and cleanup costs that businesses might face. Environmental insurance can cover cleanup or remediation costs that result from business operations, and it typically includes business interruption coverage, which protects businesses if they are forced to close temporarily due to an environmental accident.

Environmental insurance is a billion-dollar industry that benefits a wide range of industries that risk generating pollution that damages the environment around them, such as manufacturing, recycling, construction, waste disposal, and renewable energy. Environmental insurance is becoming more important as laws and regulations around the world push businesses and executives to address their environmental footprint.