Confront Environmental Risk with an ERP

While not exclusive to agribusiness, environmental exposures, such as air pollution and contaminated water and soil, must be confronted. One tool that is particularly helpful in assessing risk is called a risk profile. Typically used to identify strategies and procedures for administrative risks, a risk profile can be expanded to address areas of environmental liability.

Referred to as an environmental risk profile (ERP), it systematically helps operators identify and manage environmental risk. A completed ERP can show how environmental exposure impacts the operation and the risk management strategies available.

Environmental exposures can be grouped into three major categories: operations, transportation, and disposal liabilities. From groundwater contamination from spills or leaks, to poor air quality from manure digesters, crop stubble burning, hog or poultry confinement, to improper storage or handling of raw materials or chemicals, understanding the risks is crucial to reducing and managing them.

In an ERP, each area is explored to identify risks that may expose the operation to environmental liability. For each exposure, detail the following:

• Impact the exposure has on the operation. Consider the third-party damage, remediation costs, and reputational costs.
• Responsibility. Outline who is responsible for handling each task associated with the exposure.
• Risk management technique. Consider how risks can be prevented, monitored for early detection, or insured.
• Prior incidents. Identify any previous incidents and detail what happened before, during, and after.

A complete ERP can help better identify, manage, reduce, and even eliminate exposures to environmental liability and related costs. The AssuredPartners Agribusiness team helps clients assess risk, navigate the insurance market, and find solutions. Reach out today to start a new ERP with the expertise of AssuredPartners Agribusiness and discover the solutions that are right for you.