1. Forms
2. CG
3. CG-21-49

What the form is

The CG 21 49, titled Total Pollution Exclusion Endorsement, is an endorsement to the Commercial General Liability (CGL) policy. Its primary function is to replace the CGL's standard pollution exclusion (typically found in Exclusion f. of Coverage A – Bodily Injury and Property Damage Liability) with a far more restrictive and absolute exclusion. The endorsement aims to eliminate coverage for 'bodily injury' or 'property damage' that would not have occurred in whole or in part but for the actual, alleged, or threatened discharge, dispersal, seepage, migration, release, or escape of 'pollutants' at any time. This includes pollution incidents arising from the insured's products or completed operations. Essentially, it removes nearly all exceptions that might otherwise provide limited pollution coverage under the standard CGL form.

Classes of business it applies to

This endorsement is typically considered for classes of business with significant or challenging pollution exposures where the insurer is unwilling to provide pollution coverage within the CGL policy. Examples include:

• Manufacturing facilities with hazardous material byproducts
• Chemical manufacturers, distributors, or handlers
• Waste disposal, storage, or treatment operations
• Contractors involved in activities with high pollution potential (e.g., asbestos abatement, large-scale painting, land remediation, though specialized coverage is usually preferred for these)
• Businesses with significant fuel storage or transportation exposures
• Agricultural operations with large-scale chemical or pesticide use
• Any business where the underwriter deems the pollution risk too high for standard CGL coverage, often referred to as "large risks."

Special considerations

• Highly Restrictive: This is one of the broadest pollution exclusions available and severely limits coverage. Insureds and their agents should be fully aware of the implications.
• Alternatives: If an insurer insists on a broad pollution exclusion, agents should attempt to negotiate for less restrictive alternatives, such as the CG 21 55 (Total Pollution Exclusion With A Hostile Fire Exception) or CG 21 65 (Total Pollution Exclusion with Hostile Fire and Building Heating/Cooling Equipment Exceptions), which provide some minimal 'givebacks' of coverage.
• Products/Completed Operations: The exclusion explicitly applies to the products and completed operations hazard, a critical consideration for many businesses.
• State-Specific Rules: While widely available, its use may be restricted in some jurisdictions. For example, in Texas, it may not be approved for general use but can be applied to "large risks." Always verify local applicability and regulations.
• Definition of Pollutants: The standard CGL definition of 'pollutants' is already broad, and this endorsement makes the exclusion of losses arising from them comprehensive.
• Avoidance: Many risk management professionals advise avoiding this endorsement whenever possible due to the significant coverage gap it creates.

Key information for agents and underwriters

• Pricing/Rating: Often, no premium credit is offered for the attachment of this significant exclusion, which should be a point of discussion. Rating is typically on a "refer to company" basis.
• Risk Assessment: The presence of CG 21 49 signals that the underwriter has identified a substantial pollution exposure that is not acceptable under the standard CGL terms. It implies that any necessary pollution coverage must be secured through separate, specialized pollution liability policies.
• Coverage Gaps & E&O: Agents must meticulously explain the drastic reduction in coverage to the insured. Failure to highlight this gap and discuss alternatives like standalone pollution policies can lead to significant errors and omissions (E&O) exposures for the agency.
• Underwriting Intent: Underwriters use this endorsement when the objective is to provide virtually no pollution coverage via the CGL. Its use should be well-documented, and the insured's acknowledgment of the reduced coverage is advisable.
• Negotiation: If faced with this endorsement, agents should advocate strongly for the insured, first by attempting to have it removed, and failing that, by negotiating for a more lenient version like CG 21 55 or CG 21 65.