Wells Fargo Insurance, part of Wells Fargo & Company (WFC), announced the launch of its Prop 65 insurance program, the first liability insurance program tailored to provide financial protection for product manufacturers, distributors, and formulators of products that contain any of six plasticizers covered under California Proposition (Prop) 65.
The average settlement cost for these claims exceeds $80,0002 with fines costing as much as $2,500 per exposure per day, according to Wells Fargo Insurance. Existing general liability, product, and pollution policies currently do not provide coverage, which puts companies at financial risk if faced with a Prop 65 civil lawsuit.
Under Wells Fargo Insurance’s program, companies can now mitigate risk by securing coverage to provide protection from the costs associated with defending a Prop 65 lawsuit specific to plasticizers, including fines, penalties, legal costs, and expenses. The coverage is serviced by Safehold Special Risk, Inc., a division of Wells Fargo Insurance, and underwritten by Hiscox, a leading specialist insurer.
"At Wells Fargo Insurance, we continually look for ways to innovate and provide our customers with the right services and resources," said Glynis Priester, Wells Fargo Insurance Environmental National practice leader. "We recognized a need existed with our customers and in the marketplace and we worked closely with SPI, The Trade Association of the Plastics Industry to craft the program."
California Proposition (Prop) 65 was passed into law in 1986 and requires product manufacturers, distributors, and formulators to provide "clear and reasonable" warnings on products sold in California that contain chemicals known to be carcinogenic, or cause birth defects, if exposure to those chemicals from the product exceeds the safe harbor level. Currently, California Prop 65 covers more than 800 chemicals.
Wells Fargo’s Prop 65 insurance program provides coverage related to the following plasticizers, DEHP, DBP, BBP, DIDP, DnHP , DINP3.
"This was a true team effort across Wells Fargo Insurance and is a testament to the breadth of our resources and expertise," John Paulk, Jr., vice president and programs leader of Safehold Special Risk added. "We’re excited to offer the industry’s first Prop 65 insurance program as we continue to help our customers protect what they value most."
The Wells Fargo program is endorsed by SPI and offered as a business benefit by SPI to its members.
Wells Fargo’s Environmental National Practice helps customers with financial underwriting and insurance, including pollution legal liability, guaranteed fixed price cleanup, environmental surety, and lender liability.