Broker Brands has launched Polluticover for domestic properties.
For a premium of £25, a home on a plot of up to half an acre is covered for up to £1m for up to 25 years. Householders are covered for legal advice, legal costs and any clean up costs.
The insurance has been brought out following the new regulatory regime for contaminated land that came into force last April.
Homeowners now have a potential legal responsibility if pollution is discovered on their land.
The need for a policy was identified by Tony Baker, former deputy general of the ABI.
He said: “My solicitor drew this new pollution risk to my attention when I bought a house last year. I paid for an environment report on the garden.
“While the report concluded that the risk of pollution was very low, it contained no guarantee for the future.”