Beazley’s Pearson: Insurers can act as enabler in brownfield site development

By Rebecca Delaney

April 17 - (The Insurer) - Interest in redeveloping disused industrial land is growing across the UK, and Beazley's Nicholas Pearson believes insurance can play an important role in helping facilitate regeneration by making difficult sites more attractive to investors, particularly in areas where redevelopment brings social and economic value.

Earlier this month,p UK Prime Minister Keir Starmer confirmed plans to construct a Universal theme park on the site of the former Kempston Hardwick brickworks near Bedford, the latest in a series of developments on brownfield sites.

Pearson, who serves as senior environmental underwriter at Beazley, told The Insurer projects on disused industrial land can carry significant environmental and regulatory risks.

Pollution risks in brownfield sites depend on the former use of the site, with potential groundwater contamination including asbestos, volatile organic compounds, hydrocarbons, polyaromatic hydrocarbons, and metals.

“You often find legacy contamination from former industrial activity – such impacts would also include breakdown products of chemicals over time,” he said.

“Historically, hazardous materials were likely poorly handled or even buried onsite, before environmental standards and controls were in place.”

There is generally limited cover for pollution-related exposures under public liability or construction policies.

“Pollution is commonly excluded from insurance policies. These are historic issues that don’t typically fall under accidental damage,” said Pearson.

Current products in the specialty market that offer a form of coverage are pollution legal liability and environmental liability policies, with some specialist products also offering protection against unknown conditions that are discovered on-site during development.

Project developers in particular can run into issues around unknown and unexpected pollution conditions during development, which cannot always be detected during regular due diligence processes.

“Site investigations are only indicative – you're not sampling every inch of ground. There is always a risk of unanticipated pollution, particularly when digging into brownfield sites,” Pearson warned.

“Developers also face operational exposures like dust, vapour, or runoff during construction. There is also the possibility of extreme weather events such as flooding that can mobilise contaminants to impact offsite sensitive receptors such as water bodies.”

He added that there are opportunities for closer collaboration between insurers, developers and local councils, who often want to see these sites developed as this will bring in investment.

“Brownfield sites are often in desirable areas – near waterways, close to town centres – but are blighted by contamination. Insurance can act as an enabler,” he said.

“It is more sustainable to redevelop brownfield than to use greenfield land, and we help unlock that by de-risking the process.”

“What is needed now is greater awareness and education around the support that insurance products offer – not just financial cover, but access to vendors, claims expertise, and help in managing incidents quickly,” Pearson concluded.