Divesting of surplus or underperforming assets can be a cash generating strategy for more productive business investment. While purchase and sale agreements can be structured with the buyer as indemnitor, there is no guarantee that an indemnitor will fulfill its indemnity obligations. And in the event of an indemnity default, there is a risk that the environmental liabilities will revert back to the seller as regulators will often look back down the chain of ownership for responsibility.
Counterparty Credit Risk and the “Excess of Indemnity” Solution is a brief video discussion of what companies can do protect themselves from default on indemnified environmental liabilities using specialty coverage beyond the standard pollution legal liability policy.
Marsh’s Environmental Short-Course Series is a collection of highly focused, 15-20 minute topical discussions on environmental risk management that are relevant and useful in today’s business climate.
Other courses in the series include: