Chemical and Pharmaceutical
In chemistry and pharmacy, the insurance file is built on regulatory paper: the safety data sheet of each substance, the classification it corresponds to, and the installation authorisation describe the risk before anyone fills out a questionnaire. The underwriter reads these documents, so keeping them up to date is part of the programme.
Environmental damage, storage and batch recall
Gradual pollution is covered with its own policy
Here, two exposures with different logics coexist. One is material and localised: the classified warehouse, the process, and the accumulation of finished product. The other is diffuse and manifests with delay —the soil, the aquifer, the claim that arrives years after exposure—, and each needs its own policy. The boundary between them is what should be read carefully.
Accidental pollution versus gradual pollution
General liability usually only covers sudden and identifiable events. Gradual pollution and the remediation required by Law 26/2007 on Environmental Liability require their own guarantee, and in some activities, it is also mandatory.
The classification of the substance and the warehouse
The Regulation on the storage of chemical products, approved by Royal Decree 656/2017, and its complementary technical instructions set how much of each class can be stored and with what measures. Changing supplier, increasing concentration, or expanding capacity simultaneously modifies the regulatory obligation and what was declared upon subscription. Articles 11 to 13 of the Insurance Contract Law refer to this as an aggravation of risk, and timely communication is what keeps the indemnity intact.
Claims with years of latency
Exposure to a substance and the claim for it rarely occur in the same period, so in a claims-made policy, the agreed retroactive date is what decides if that activity is still covered. The second paragraph of Article 73 of the Insurance Contract Law sets the minimum for that date, and what is gained above that minimum is negotiated at each renewal.
Batch blocking and communication to the authority
In pharmaceuticals, recovery begins before logistics, with a regulated decision: block the batch, qualify the quality defect, and communicate it to the authority within the timeframe corresponding to that class, following the nominal distribution to the pharmacy office. The cost of this operation and attending to the accompanying file are assessed separately from the damage to the patient, and whoever manufactures for a third party is also liable for what has been assumed in the manufacturing contract.
The covers that support a company in this sector
Each one is designed based on the company's real exposure. None are contracted the same in two companies in the same sector.
Lo que nos preguntan en chemical and pharmaceutical
Does the liability policy cover environmental damage?
It covers accidental pollution, which arises from a sudden and identifiable event, and responds to the affected third party. The remediation of the natural resource imposed by Law 26/2007 is of a different nature: it is an obligation to restore the damaged resource, enforceable by the Administration, and to address it, a specific environmental liability policy is required.
What changes in the insurance when we expand the chemical product warehouse?
The declared risk changes. A new capacity, a substance of different classification, or a modification of the installation are considered an aggravation of risk for the purposes of Articles 11 to 13 of the Insurance Contract Law, and must be communicated as soon as possible. If communicated in time, the aggravation is resolved with a premium supplement that keeps the indemnity intact; if communicated after the claim, the insurer reduces it in proportion to the premium paid and what would have been due.
Is the environmental liability policy sufficient to prove the financial guarantee required by the regulation?
Law 26/2007 allows several ways to establish it, and in mandatory activities, its amount is determined based on the environmental risk analysis of the installation. This analysis is done before the policy and determines its amount, so commissioning it in advance is what allows negotiating the cover instead of accepting it.
What we have published about these risks
Loss of profits: the indemnity period that almost no one calculates correctly
Twelve months is the market standard and a decision that is rarely reviewed. In many industries, it is not even enough to replace the critical machine.
7 min de lecturaAnálisis
Underinsurance: why many warehouses would receive half of what their owner believes
The proportional rule is the clause that costs the most money in Spain and is almost never discovered until the day of the claim. How to detect it beforehand.
7 min de lecturaNota técnica
Product liability and recall expenses: two covers that are confused daily
One covers the damage caused by the product. The other pays for the operation of removing it from the market before it causes damage. They are not the same guarantee.
6 min de lectura