9.5.4 Insurance and Guarantee Requirements

A. Borrowers are required to obtain separate insurance for environmental hazards from an insurer acceptable to HUD if remediation work will be done on the site during the insured loan period, if the coverage is available. Environmental hazard insurance typically covers liability (including occurrence coverage for harm that manifests itself during or after the remediation work) and cost of completion.

B. The environmental remediation contractor will almost always be different from the project's General Contractor. Aside from the contractor qualifications, licensure and bonding that are addressed above, the remediation contractor must provide HUD a separate guarantee of completion for their work on a form prescribed by HUD.