1. Forms
2. CA
3. CA-99-48

What the Form Is

The CA 99 48, titled "Pollution Liability – Broadened Coverage for Covered Autos – Business Auto and Motor Carrier Coverage Forms," is an Insurance Services Office (ISO) endorsement designed to modify the standard pollution exclusion found in commercial automobile liability policies. Its primary function is to "buy back" coverage for certain pollution exposures that would otherwise be excluded. Specifically, it addresses liability and costs associated with "covered pollution cost or expense" resulting from the discharge, dispersal, seepage, migration, release, or escape of pollutants from a covered auto. This typically includes bodily injury, property damage, and costs for testing, monitoring, cleaning up, removing, containing, treating, neutralizing, or in any way responding to or assessing the effects of pollutants.

Classes of Business It Applies To

This endorsement is crucial for businesses with exposures related to transporting materials that could be considered pollutants. Examples include:

• Trucking Companies: General freight haulers that may transport a wide variety of goods, some of which could be pollutants.
• Waste Haulers: Companies involved in hauling municipal solid waste, construction debris, or other non-hazardous or hazardous wastes.
• Fuel Haulers: Businesses transporting gasoline, diesel, or other petroleum products.
• Contractors: Construction companies or other contractors that transport materials like chemicals, solvents, or asphalt to and from job sites.
• Any business operating vehicles where a release of pollutants from the vehicle (cargo or operating fluids beyond the standard limited coverage) could lead to environmental liability.

For instance, a trucking company hauling drums of industrial chemicals would need this endorsement. If one of their trucks is in an accident and the drums rupture, leading to a chemical spill, the CA 99 48 would respond to the costs of cleanup and any third-party damages, subject to its terms and limits.

Special Considerations

• Interaction with MCS-90: For motor carriers operating in interstate commerce, the MCS-90 endorsement is often federally required. The MCS-90 ensures that funds are available to pay for public liability, including environmental restoration, regardless of whether the underlying policy covers the loss. However, if the MCS-90 pays for a pollution loss excluded by the auto policy, the insurer has the right to seek reimbursement from the insured. The CA 99 48 provides actual insurance coverage for certain pollution events, thereby reducing the insured's potential reimbursement obligation to the insurer under the MCS-90.
• Scope of Coverage: While it broadens pollution coverage, the CA 99 48 is not a comprehensive environmental impairment liability policy. It typically applies to pollutants escaping from a covered auto. It may have limitations; for example, it might not cover pollution resulting from loading and unloading activities unless specifically stated or if another endorsement provides that coverage. It generally responds to demands or orders from governmental authorities for cleanup.
• Availability and Cost: Not all insurers may offer this endorsement, or they may be selective in providing it based on the insured's operations and the nature of the cargo. An additional premium is typically charged for this broadened coverage.
• Contractual Requirements: Businesses may be contractually required by their clients to carry this type of pollution liability coverage.

Real-world example: A hauler of liquid asphalt has an accident, and asphalt spills onto the roadway and adjacent soil, requiring significant cleanup ordered by the state's environmental agency. The CA 99 48 endorsement on their Business Auto policy would help cover these cleanup costs and any resulting third-party property damage claims.

Key Information for Agents and Underwriters

• Risk Assessment: Agents and underwriters must carefully assess the insured's operations to determine the extent of their pollution exposure. This includes understanding the types of materials transported, the geographic areas of operation, and loss history.
• Coverage Gaps: It's crucial to explain that while the CA 99 48 significantly broadens coverage, it doesn't cover every pollution scenario. Standard auto policies typically exclude most pollution incidents unless the pollutants are vital to the vehicle's operation (like fuel or lubricants leaking after an accident). The CA 99 48 addresses pollutants being transported or towed by, or being loaded onto or unloaded from, a covered auto.
• Policy Language: The specific edition date of the CA 99 48 and the underlying auto policy language should be reviewed carefully to understand the exact scope of coverage and any applicable exclusions or limitations.
• Pricing: Underwriters will price this endorsement based on the perceived risk, considering factors like the type and quantity of pollutants hauled, routes taken, safety record, and requested limits.
• Alternative/Supplementary Coverages: For businesses with significant pollution exposures, a standalone Transportation Pollution Liability (TPL) policy or Contractors Pollution Liability (CPL) policy might be more appropriate or could supplement the CA 99 48 by offering broader coverage, higher limits, or coverage for exposures not addressed by the endorsement (like loading/unloading if excluded).