With LP3 insurance, lenders receive protection from commercial real estate loans that may be at risk if environmental contamination and default occur together.
GILBERT, AZ / ACCESS Newswire / October 26, 2026 / Lender Environmental Diligence (LED), a Del Rio Group company, today launched Lenders Parametric Pollution Protection (LP3), an insurance product that protects commercial real estate lenders when environmental contamination and financial default occur together. LP3 offers lenders a more efficient due diligence alternative to a Phase I Environmental Site Assessment (ESA) and bypasses the traditional claims process by introducing parametric insurance. LP3 is underwritten by Lloyd's of London and designed for loan transactions up to $10 million on lower-risk property types.
Although Phase I ESAs have long been the standard environmental review for commercial loans, they can take weeks to complete and are informational only, providing no financial guarantees to lenders. LP3 reduces due diligence timelines to 2-3 days and protects lenders if contamination is missed or occurs after closing.
For underwriting purposes, LED has partnered with VERAcheck to provide a desktop review of historical, regulatory, and location records. These desktop studies contain 80-90% of the information in Phase I ESA and are reviewed by the consultants at Environmental Risk Professionals. Together, the desktop study and the LP3 insurance policy usually cost less than a Phase I ESA and meet the environmental due diligence requirements of federal banking regulators, including the OCC, Federal Reserve, FDIC, and NCUA.
Parametric insurance bypasses the delays of traditional claims adjustment by paying a fixed, predetermined amount when specific parameters are met. With LP3, if a covered pollution condition is discovered and a borrower has a qualifying financial default, the lender receives the outstanding loan balance plus accrued and unpaid interest. Having received full payment, the lender can walk away, avoiding the time and costs associated with environmental remediation and foreclosure.
Ben Sturgeon, General Counsel and Chief Product Officer of LED, added, "We listened to bank attorneys and lending executives who told us existing environmental insurance doesn't really meet their needs because it only pays to clean up pollution, which can take a long time and actually introduces more risk. What they want most is for a bad loan to be off their books and their money back so they can lend it out again. Only parametric insurance does this."
LP3 is available now to commercial real estate lenders across the U.S. Learn more at lenderenv.com.
About Lender Environmental Diligence
Lender Environmental Diligence is an MGA focused exclusively on protecting commercial real estate lenders. LED was founded by the principals of UCPM, the leading wholesale insurance brokerage focused exclusively on environmental insurance, with almost 30 years' experience protecting lenders. LED is a coverholder with Lloyd's of London and the exclusive provider of LP3.
Media Contact
Erika Ferrin
Director of Marketing and Communications
eferrin@delriogroup.com
480-407-6664
SOURCE: Lender Environmental Diligence
View the original press release on ACCESS Newswire:
https://www.accessnewswire.com/newsroom/en/banking-and-financial-services/lender-environmental-diligence-launches-new-parametric-insurance-pro-1239451
