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Oil spill insurance (residential): does anybody out there actually have it?

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seized123
seized123 Member Posts: 297
So I just found out my homeowner's insurance does not cover an oil spill (unless it is caused by one of their covered "perils", like if a tree gets knocked into the oil tank in a storm, etc.), and they do not offer it.

Does anybody out there have it, or know anything about it? Any suggestions where to start? I googled the famous big insurance providers and don't see any obvious indications they offer it.

I can start making calls, of course, but would like to hear if there are real people who really have it, as it seems to me a very worthwhile thing to have, depending on cost, etc.

Comments

  • Mad Dog_2
    Mad Dog_2 Member Posts: 7,208
    edited May 2023
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    @Alan R. Mercurio_3 would know. Great guy...Mr Oil.....Oiltechtalk.com. mad Dog 

  • seized123
    seized123 Member Posts: 297
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    Hi, @Mad Dog_2, thanks, I'll look into that.
    Mad Dog_2
  • seized123
    seized123 Member Posts: 297
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    Just found a company called The Powderhorn Agency which appears to offer it in a product called ProGuard. Will probably call them.
  • Waher
    Waher Member Posts: 257
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    In Massachusetts insurance companies are required to offer it as an optional rider on homeowners insurance. It's around $60 a year and you have to produce a form signed by a oil service company/plumber that the fuel oil tank and fuel lines to the boiler meet current code.
  • seized123
    seized123 Member Posts: 297
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    I like that, but it must not be true in New York State (forgot to say that’s where I am).
  • Jamie Hall
    Jamie Hall Member Posts: 23,566
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    If you have a delivery contract with an oil company they may have insurance for at least certain perils -- and will inspect your tanks.
    Br. Jamie, osb
    Building superintendent/caretaker, 7200 sq. ft. historic house museum with dependencies in New England
    GGross
  • trivetman
    trivetman Member Posts: 180
    edited May 2023
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    I work in insurance.  Not a homeowners specialist but I know enough.  If you want broader coverage, look for coverage on an ‘all perils’ basis as opposed to ‘named perils’ which it sounds like your current policy is.

    All Perils coverage is in reality anything but total coverage as any policy will be littered with exclusions.  I am sure that coverage for an oil spill would be excluded through pollution exclusions which will be in most if not all policies out there.  Pollution coverage may be available through specific endorsements but will take some looking around and it may only be available through a limited number of insurers.  Its worth calling an agent to see whats available - preferably an independent agent (i.e. works with many insurers) who advertises themselves as looking for the best coverage, not just best price.  Realistically,  that agent is hard to find.

    Theres a reason you’re not seeing coverage offered through most companies.  Pollution in general and oil tanks specifically have been a major source of insurance losses, specifically as underground tanks have degraded.  

    i did a quick search and found the powderhorn agency.  I did not see any indication of what insurer is behind the product.  It may be completely legit but my ears did start to tingle.  If you pursue,  I would make sure a licensed insurer is behind the contract.  That doesn’t mean they wont fight against paying a claim but it does mean they are a regulated insurance business that needs to meet the capital requirements of the state regulator and that the product they offer is a legitimate contract.

    The proguard product is definitely marketed as insurance.  If there is not an insurance company behind it I would run and also likely send a note to the NY insurance regulator.


    WMno57
  • clammy
    clammy Member Posts: 3,113
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    If one day you plan on retiring then you better have tank insurance usually it is obtained from and through your oil delivery company or oil service company ,cash oil companies do not offer tank insurance cause there usually a dba business . Oil cleanups can cost big bucks and without insurance you will be left picking up the bill . I advise any and all oil user to have tank insurance not having it is foolish . I have worked in the oil end and had a customer w a bad 275 that refused to replace well the bottom went and he was out well over 100 k no tank insurance and this was about 20 years ago he was planning to retire ,they still occupy the home and he never retired they where lucky being it mostly leaked on soil w rock under so it never hot the water table but again they where told for years and every fill up a note was left for like 15 years a cheap stake who though we where just looking to sell another tank .
    If it’s buried get it outta the ground and get roth above ground and if it’s a steel above ground have it replaced w a roth double wall and piped a single pipe feed . 2 piped system on above and buried tanks always have the potential risk of return lines leakage and then u have a issue .
    Tanks insurance is not a scam it may seem so bu5 if yourtank takes a dump you will be wishing you had it . Again if you have a full service oil company then enquirer ,you may and will have to get any under ground tank usually tested and above ground they usually just replace .
    Peace and good luck clammy
    R.A. Calmbacher L.L.C. HVAC
    NJ Master HVAC Lic.
    Mahwah, NJ
    Specializing in steam and hydronic heating
    PC7060
  • DJD775
    DJD775 Member Posts: 252
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    I my opinion the best insurance is changing the tank more frequently than necessary and drastically reducing the risk of a spill. It doesn't hurt to have insurance too but why put yourself through the hassle of dealing with a spill and a major cleanup in your house.
  • seized123
    seized123 Member Posts: 297
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    Thanks for the helpful info.

    I will start by asking my oil company about insurance, also do more research.

    @trivetman very interesting. I now have seen that Powderhorn was acquired in 2019 by Assured Partners which seems to be a large brokerage firm made up of smaller brokerage firms. It does make Powderhorn seem more legit. But I also notice that their ProGuard product is limited to $50,000 of cleanup coverage for an above ground tank, and I understand that serious spills can easily go into the six digits. I'd rather find insurance for more.

    @clammy and @DJD775, good info. I have an above ground tank that is in a large plastic tub with a cover. The cover seems to have seams but the tank also sits in an inner plastic tub open at the top which comes up to about 2/3 of the tank's height, and I don't think this has seams. This seems to me to be pretty good protection if the tank itself were to leak (though I'll have it checked by the oil company). But I am still concerned about the supply and return lines (it's a 2-pipe system even though the tank is above the level of the burner and I'm thinking of changing to 1-pipe). The lines and fittings are suspect, as I have learned on another thread (with pictures) where I got lots of excellent advice, and I intend to have all that updated.

    @clammy I am about thirty minutes north of you, and this is a little off-topic for this thread, but have you (or anyone reading this) ever looked into whether there are heat pump systems that could do the job without backup in our specific climate? I don't have ducts so it would be a mini-split ductless system. My original idea was to put a mini-split or two on our first floor to supplement the oil for heat and to have A/C, then incrementally expand if we like it. But now I realize if we went 100% heat pump I wouldn't have to worry about spills, which frankly would be a big plus for me.

  • trivetman
    trivetman Member Posts: 180
    edited May 2023
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    I took a look at Assured Partners and it seems a legit operation.  They are an agency setup.  They are not the insurance company but essentially an outsourced sales operation.  Its a common setup.

    Any insurance product has limits of coverage.  On a known hazard like this, take what you can find as long as you find the price somewhat reasonable.

    like was said, best insurance is proper maintenance and protection.  Make sure your oil suppliers are properly covered and act like professionals with proper safety.  If additional coverage is available through the oil supplier that could be better protection than what’s available directly to homeowners, or at the least give additional protection.

    Also - I am a bit south of you around Philadelphia.  Ive got a Mitsubishi mini split for part of the house that does function down below freezing temps.  I couldn’t tell you exactly what the range is or how much efficiency it loses at colder temps.  But it’s definitely functional without having to rely on electrical resistance heat backup
  • seized123
    seized123 Member Posts: 297
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    Thanks @trivetman, very valuable advice, and thanks for heat pump info. Going to heat pumps might be a good idea, but I would rather transition slowly, have time to do the research, etc., not jump into it suddenly because I'm worried about not being covered for oil spills (which I am, frankly, even though the tank is above ground and in a tub and most of the system is visible).

    I have recently acquired a bit of DIY fever with respect to the oil heating system (bought a wet kit and an old soot vacuum), and I know there are DIY-induced-hazards possible with all aspects of the system related not just to possible spills but also CO and smoke, but all this makes me think it would be very wise never to touch anything between the fuel pump and the tank, and have the pros do it.
    trivetman
  • trivetman
    trivetman Member Posts: 180
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    Ive learned a ridiculous amount of HVAC expertise through this site from industry experts for free.  Ive yet to find an insurance blogsite in desperate need of my expertise to all the desperate people trying to understand insurance policies (I haven’t really looked that hard).  So….when I actually do see someone asking about insurance issues, I try.  😁😁
  • seized123
    seized123 Member Posts: 297
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    Ha, funny I was going to ask you whether here was such a site!

    Insurance is a strange and interesting rabbit hole to many of us who have it and would like to know what exactly it is that we have (or should have).
    trivetman
  • jringel
    jringel Member Posts: 27
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    I worked for 2 oil companies in New York that offer pro guard but believe it was just for their customers. It is available but would depend on what part of the state you are in.
    John Ringel Energy Kinetics
  • CLamb
    CLamb Member Posts: 292
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    seized123 said:

    Just found a company called The Powderhorn Agency which appears to offer it in a product called ProGuard. Will probably call them.

    I got a policy from them when I had an underground tank and my State Farm homeowners insurance dropped oil tank leaks. I have since replaced my underground tank with a basement tank. It costs me $99 last year. It was the only coverage I could find here in New Jersey. It is only available through oil dealers.
  • clammy
    clammy Member Posts: 3,113
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    As I stated usually it available through a full service oil company usually ,as for a mini split heat pumps as a primary I personally wouldn’t put all my eggs in that baskets . Possible a dual fuel heat pump / oil furnace or bag the oil and go propane and do a 2 stage gas w a Bosch inverter heat pump . What type of heat do u have now hot water / steam / hot air? Any of these system can be made to operate properly and if it’s oil price don’t think it would be much cheap to heat w all electric no matter type of system .
    Peace and good luck clammy
    R.A. Calmbacher L.L.C. HVAC
    NJ Master HVAC Lic.
    Mahwah, NJ
    Specializing in steam and hydronic heating
    PC7060
  • seized123
    seized123 Member Posts: 297
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    I have hot water baseboard. I like it, I hear it can be nicer than having air blown at you.
  • trivetman
    trivetman Member Posts: 180
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    seized123 said:
    I have hot water baseboard. I like it, I hear it can be nicer than having air blown at you.
    Yes it can be.  I like my mini split.  I wouldn’t want it being my primary house heat given the choice