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Does Home Insurance Cover Oil Tanks?

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Damaged oil tanks can cause a lot of disruption and can be expensive. Whether it is the cost of repairing or replacing the tank, the loss of oil that has leaked out, or the damage that has been caused by the oil leak, costs can add up. It is, therefore, important to know what aspects of your oil tank are covered by your insurance.

Of course, there are many different insurance policies available, and it may be that yours is different from the next one, so it is important that you check your individual policy. However, in most cases, your insurance will cover the costs of any loss of oil as well as the cost of any damage to the fabric of your home that has occurred due to a domestic leak.

You should check the details of your insurance policy but when it comes to contamination and pollution, often the insurance cover available will have restrictions and/or a financial limit. It does not usually, however, cover the costs of environmental investigation or the cost of cleaning up your own land or any polluted ground or surface water.

It is also important to remember that there are often restrictions present on third-party insurance policies if the spilt oil damages or pollutes neighbouring property, land, or water.

Reasons Why an Oil Tank Might Leak

They say that prevention is better than cure, so by understanding the reasons why an oil tank might leak, you can help to protect it (and therefore, reduce the chance of getting a leak), and also be able to spot the signs, enabling you to try to catch any leaks early on and before it causes any bad damage.

Some of the reasons why an oil tank might leak include:

  • Oil tank failure – often damage that is caused to the tank, caused by rust in steel tanks or internal or external damage to the tank.
  • Failure or damage to components in the tank, such as valves.
  • Failure or damage to other equipment related to the tank, such as the sight gauge, filters or pipe work.

Some of the ways that you can help to prevent environmental damage or spills from your oil tank, include housing it in a separate construction, creating a barrier between the tank and its immediate environment, or you could also consider using a bunded tank – essentially, a tank with a double skin, protecting the oil inside.

Who Is Responsible for Any Leaks That Might Occur?

Damage or leaks can occur at any time, and it is everybody’s responsibility to do what they can to not only protect the oil tank in an appropriate manner, but also to report, clean up, or make safe any spills that have occurred.

This stretches from those who manufacture the tank, to people who are transporting it, filling it, storing it, or using it.

How to Know If Your Policy Will Cover Your Tank?

If you have an oil tank, it is important that you know what is covered in your home insurance. Your insurance policy paperwork should give you the details, but you may need to speak directly to your insurance company to clarify them.

If you are not satisfied with your policy you can ask your insurance company to amend it or consider taking out separate insurance.

Thursday 29th July 2021
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