At least a couple of times a week we hear from another dry cleaner who, facing a lawsuit by his landlord or has received notice from the state environmental agency. He has already turned to his insurance agent for coverage for the damage to soil and groundwater allegedly caused by his operations over the years. The dry cleaner, who failed to keep copies of his old policies, had been hoping that his long-time insurance agent would have them. He is surprised by his insurance agent’s excuse. “ The new record retention plan only requires that we keep records for seven years.”
California courts require the party asserting coverage under an insurance policy to not only prove the policy’s existence but also the terms and conditions of the policy. The insurance companies of course are very knowledgeable about what the courts require and will only agree to search for a policy after the policyholder provides the level of proof that the courts will recognize. They know that the burden of proof is on the policyholder and that if the policy is never properly identified, the courts won’t make them look for it.
This is the point in the dry cleaner’s story where typically he throws up his hands and begins funding the environmental assessment work out of his savings. It seems like a quicker, better approach then paying a lawyer to battle an insurance company—a fight that may take years and may not prove fruitful.
But the dry cleaner that decides to write that check could be deciding to write a different, much smaller check. He should be hiring a different kind of professional, an insurance archeologist. The insurance archeologist’s expertise lies in finding lost and historical insurance policies or evidence of those policies.
It was the retrieval of a lost insurance document by an EnviroForensics™ insurance archeologist for instance that provided much needed funds for Bob and Inez Heidinger of Chico, California for example.
In 2003, nearly 30 years after selling their dry cleaning business, the Heidingers received a letter from the State of California advising that the dry cleaning solvent they used at College Cleaners between the years 1952 and 1974 had contributed to the contamination of the community’s drinking water. When the bad news came, Bob was 87 and Inez was 83.
Their daughter, Barbara Heidinger, says, “We knew they had been insured but we had no proof. We had thrown away their old business records when we cleaned out the attic a few years earlier.” EnviroForensics™ painstaking research in legal and insurance archives paid off for the Heidinger family. EnviroForensics™ located an insurance binder for general liability coverage from the 1980’s at a local firm that the Heidingers had not done business with for 20 years. The lost insurance binder bought some peace and dignity for this family.
“Finding the insurance was a huge relief,” says Barbara. “If EnviroForensics™ hadn’t found the insurance, the State of California could have taken everything. My parents would have lost all they had worked for.”
Insurance archeology is proving to benefit dry cleaners facing this dilemma throughout California. It is a practical and affordable way to avoid a protracted and expensive alternative.
EnviroForensics™ is the parent company of PolicyFind™ an insurance archeology firm that specializes in the location and retrieval of insurance evidence for policyholders and has successfully conducted over one hundred policy searches for dry cleaning establishments. Policy Find™ operates in all fifty states and in the provinces of Canada and Puerto Rico to prove the existence, terms and conditions of policies needed by dry cleaners to keep their businesses.
David O’Neill has over 15 years of experience in claims recovery on behalf of corporate policyholders involving environmental property damage and toxic tort and asbestos exposure claims. He is an accomplished insurance archeologist with extensive experience in locating and retrieving insurance coverage evidence on behalf of potentially responsible parties responding to environmental investigation and remediation demands. Mr. O’Neill is also an experienced Potentially Responsibility Parties investigator with knowledge of CERCLA/SARA requirements, having conducted over thirty PRP searches at Superfund hazardous waste sites for Potentially Responsibility Parties defense counsel and previously for USEPA Regions V and VIII. Mr. O’Neill graduated from Case Western Reserve Law School in 1986.
