Environmental Liability and the Limits of Insurance
Environmental liability has become one of the leading legal problems of this decade. It has garnered as much publicity, energy, capital, and emotion as any other contender, and for good reason. The risks of property damage, personal injury, and disease addressed by the "new" environmental liability - the common-law and statutory expansions of liability that have been developing during the 1980s - are deeply serious, for they involve at their heart our relation to the powerful technologies upon which our society increasingly has come to rely. Yet the effects of these developing legal rules are also severe: they threaten to disrupt and even to reorder established investments, longstanding methods of doing business, and pre-existing expectations about legal rights and responsibilities.
The impact of the new environmental liability on the liability insurance market, and the role that liability insurance might play in furthering the goals of a regime of environmental liability, have generated much controversy. But much of the public discourse about the appropriate relationship between environmental liability law and liability insurance, unfortunately, has produced more heat than light. Interested parties have mainly traded accusations about responsibility for the current predicament and painted opposing portraits of the future. Persuasive analysis of underlying causes and realistic policy options has too often been missing.