Massachusetts Oil Heating & Insurance Law Changes

Massachusetts Oil Heating & Insurance Law Changes

As of July 1, 2010 any home that is serviced by oil fired heating system in Massachusetts must comply with a new law that requires homeowners to upgrade their system equipment to prevent leaks. The new legislation is designed to prevent leaks from pipes and equipment that connect to your furnace.

The new law is addressed in Chapter 458 of the Acts of 2008. The two biggest provisions of the law change include the following:

The installation of either an oil safety valve or an oil supply line with a protective sleeve on systems that do not already have these devices in place. Insurance companies that provide homeowners insurance policies must offer coverage for oil tank leaks from heating systems that use oil.

Most homeowner’s policies do not currently include coverage for oil leaks leaving homeowners to fend for themselves with costly clean up bills. The new law makes it mandatory for insurance companies to offer coverage, however it is up to the individual homeowner to purchase this optional insurance. Implementation of the insurance coverage will also start as of July 1, 2010.

Who must take action?

Homeowners of one to four unit dwellings that are heated with oil must already have or install an oil safety value or an oil supply line with a protective sleeve. A licensed oil burner technician must complete installation of these parts.

If your home was built after January 1, 1990 -- you are more than likely already in compliance with the new law because state fire codes were changed to require these parts on new installations at that time.

Who is exempt?

Homeowners are not required to comply with these leak prevention steps if the oil burner is located above the oil storage tank and the entire oil line is connected to and above the top of the tank. Also if an oil safety valve or oil supply line with protective sleeve was installed on or after January 1, 1990 and the changes are in compliance with the oil burning equipment regulations. The copy of the oil burner permit from the local fire department may be used to demonstrate you are in compliance.

The cost of cleaning up an oil spill is very expensive. The cost of making this upgrade is very cheap. We are talking about a few hundred dollars to make these upgrades. Why take a chance and be left with a bill that could cripple you financially!

If you are unfortunate enough to have a leak and it reaches the soil beneath your home then a clean up is going to be necessary to bring your property back into compliance with state environmental standards. If the leak is severe enough and it impacts your neighbors or the local ground water supply the bill is going to be astronomical.

In Massachusetts, reports indicate that there are a few hundred spills a year. If you have a spill the cost for clean up on the low end is going to be $15000 to $20,000 dollars. A high end clean up can easily get into the hundreds of thousands! Who would ever want to deal with this kind of nightmare when it is so easy to avoid? I know if I owned a home that was built prior that 1990 I would not want to even think about such a catastrophe. I would make darn sure I was compliant right away!

What Kind of Insurance is available to homeowners?

In order to be eligible for coverage you must make sure that your home is either compliant or exempt from the new law.

The insurance will provide “1st party coverage” of at least $50,000 to cover the expenses of cleaning up a leak to soils, indoor air, or other environmental media from a home heating system at the residence itself and also reimbursement for personal property damage.

Secondly you must provide for “third party coverage” of at least $200,000 for dealing with any problems that occurred as a direct result of the leak for damage off of the property. This could be a near by home or the local ground water. The insurance coverage will also include costs for legal fees subject to a deductible not to exceed $1000 per claim.