By Michelle Huitt, Assistant Vice President
How many times have you been frustrated with the back and forth on a minimum premium Commercial Storage Tank account? And because these policies are used to provide Financial Assurance to the states, a quick turnaround is often required, further adding to the stress and urgency.
The following lists the minimum information required to obtain a quote and some insight as to why this is needed. This is not a complete list, but should allow you to get a quote and gather the subsequent information for binding.
First, are the tanks underground or aboveground? Underground storage tanks (USTs) tend to be larger than aboveground storage tanks (ASTs) and require more extensive testing equipment, as they are not as easy to visually inspect as an AST. In the case of ASTs, proper visual inspections can catch a release early, therefore limiting the size and severity of the release.
Second, are the tanks double wall or single wall? Double wall tanks add an extra layer of protection, minimizing the chance of a release. States find this so important that many have given tank owners deadlines to upgrade their tanks or replace them with double wall tanks.
Third, the age of the tank is critical and if you have ever tried to insure a 30-year-old tank, you probably understand the importance of this information. Age is one of the leading rating factors because the older the tank, the higher the chances are of a release. Also, some states are now requiring that all underground tanks be replaced or at the very least upgraded by a certain age, typically that magical age of 30. So even if a release has not occurred, contamination is often found during a voluntary pull to replace or upgrade the tanks. For these reasons, age of the tanks is required on all submissions.
Fourth, the size of the tanks can be just as important as age for the obvious reason. The larger the tank, the larger the potential release.
Fifth, are the contents of the tank. Most tank programs were developed to insure tanks that contain petroleum-based products and other contents that may be used in the insured’s operation such as antifreeze, windshield wiper fluid, and mineral spirits which can be used to clean mechanic’s tools. If the contents stray from this anticipated risk, you may be required to prove that the tanks are compatible with the contents they contain.
Sixth, and last but not least, is the retroactive date if an expiring policy is in place. All carriers charge for the retroactive date, so it is an important rating factor and needed to provide an accurate quote.
The information described above should be enough information to provide you with a quote, but there are many other considerations that help to underwrite the risk and possibly provide a credit. For example: Are the tanks equipped with secondary containment? What is the age of the spill bucket? What is the age and length of the piping? Does the insured have a written tank management plan in place? Is the account loss free?
Providing your underwriters with this information will expedite the quoting process and help to ensure a more accurate quote. For more information on Commercial Storage Tank Coverage or to discuss a specific account, please contact us.