The Rural View – Environmental Impairment Liability

As a farmer, you may ask yourself does my farming business need cover for Environmental Impairment Liability insurance (EIL)? The answer is that EIL is an important level of cover that will benefit your business in the event of a claim against damage you’ve caused to the environment.

Environmental Impairment Liability (EIL) insurance covers you for the financial costs incurred as a result of an incident of pollution occurring on your farm. These may include

  • Environment Agency Clean-up costs
  • Any damages that you’re ordered to pay from impacted businesses or individuals
  • The cost of defending a claim
  • Claims arising from environmental impairment

In farming the common causes of environmental damage include pollution from sewage, fuels and oils as well as the incorrect handling of pesticides and the incorrect storage of milk and silage.

Legislation such as the Wildlife & Countryside Act 1981, the Water Resources Act 1991, Nitrate Pollution Prevention Regulations 2009 and The Environment Damage (Protection and Remediation) Regulations 2009 are all Acts that you should be aware of in relation to your responsibility as a farmer.

The 2009 regulations were designed to ensure that the ‘polluter pays’ and the trend in legislation is moving towards the burden of proof sitting with the polluter.

Fines from the Environmental Agency can be severe which could leave your business financially exposed.

Top 5 things to think about

  • Carefully plan all storage and handling arrangements for all potential pollutants
  • Keep a suitable distance from watercourses (including ditches) and drinking water supplies when handling or applying fertilisers or other chemicals
  • Make sure run-off from your farmyard, ring feeder areas and hard standings don’t discharge directly to a watercourse
  • Don’t employ contractors or companies in waste spreading unless they are trained and are planning to follow guidance in line with legal requirements
  • Be aware that even if it is not directly your fault (for example, if a burglar accidentally damages a slurry tank which pollutes a nearby river), you are the polluter and so are liable for any damages.

Environmental Impairment Liability cover of up to £1 million is available in Rural Insurance’s Farm Combined insurance policy. What’s more Rural’s EIL cover provides a ‘retroactive date’ which means you are continuously covered from the date you first purchased the cover, even if this was from another insurer. This gives you more comprehensive cover in the event of a gradual incident.

About Rural Insurance

Rural Insurance is a specialist rural and agricultural insurer providing farm, farm motor and rural business motor insurance to rural communities across the UK. With more than 20 years’ experience, they help over 26,000 customers keep their businesses moving in a rural economy that never stands still.

To find out more about Rural’s farm and farm motor insurance visit their website