United Kingdom

Environmental Risk Management - Our business approach

The key to our business model is collecting, evaluating, and providing information on all material environmental risks, the relationships among the various parties involved, and the goals and objectives of those we insure. This helps us obtain the optimal terms and conditions from insurers.

How we work

Using a multi-disciplinary approach comprising engineering, legal and risk management, we help identify environmental exposures and assess liability potential.

This includes:

  • Bodily injury, property damage, clean-up, and legal defense costs associated with known and unknown pollution conditions
  • Global operational exposures
  • Legacy environmental liabilities including balance sheet impacts
  • Property acquisition and divestiture liabilities
  • Carbon emissions, carbon foot-printing, carbon credit verification and other greenhouse gas and global warming topics
  • Green buildings and green building certification support schemes
  • We will also explore risk transfer options and can help enhance existing environmental programmes, or suggest specific environmental risk management protocol. Other services include claims advocacy, policy maintenance and administration

The European Union Environmental Liability Directive

The implementation of the Environmental Liability Directive is an example of new regulations creating new exposures for business.

The Environmental Liability Directive (ELD, 2004/35/EC) is a legislative act of the European Union creating new and significant potential liabilities for costs, damages and losses for operators and companies regulated by the ELD. All EU members have now adopted the ELD into their national laws, making compliance unavoidable for companies operating in EU member states, regardless of where they are headquartered.

Remediation costs

Environmental fines and litigation costs can be considerable, including time and resources.

Information on ELD costs are gathered on an ad-hoc basis because Europe currently does not have a central database to track ELD loss and damage. However, while it's still too early to confirm, the costs associated with Natural Resource Damage claims in the U.S. are expected to increase significantly. It is critical to have a professionally designed risk prevention and mitigation programme in order to protect a company's brand.

The importance of insurance

Financial security plays an important role in the ELD.

Currently, eight EU member states have committed to imposing mandatory financial requirements on operators, and more member states are expected to join. In these member states, insurance – among other instruments – is accepted as financial security. In some member states, the adoption of the ELD is backdated to 30 April 2007, and this should operate as the assumed date for the purpose of insurance retroactive dates for all member states.


Last updated 8 January 2019

Aon UK Limited is authorised and regulated by the Financial Conduct Authority. FP5559