Storage Tank Insurance: Insurance for Tank Contractors

Storage tank insurance is typically not aimed at insuring physical storage tanks but rather insuring the contractors that service these tanks. Underground storage tanks are present in most large business and factory locations in the United States, including manufacturing plants, large hospitals and golf courses, to name a few locations. The contractors who are responsible for maintaining the function of these tanks need insurance to protect them in case of exposures in a variety of key areas.

General Liability

Nearly every business requires some type of general liability policy. It covers the major exposures a business owner encounters, such as basic lawsuits, property damage and liability exposures. This policy is necessary for any independent contractor working on storage tanks to protect him- or herself from personal lawsuit. It may also provide assistance in the case of a disaster that prohibits business operations for a limited period.

Contractor's Pollution Liability

Many general liability contracts for storage tank facilitators will cover contractor's pollution liability (CPL). This area of the policy covers any claim of environmental contamination against the business owner. If this line of coverage is not covered in a general liability policy, a storage tank maintenance contractor should add the line independently. 

Professional Liability

As part of the CPL or general liability policy, a professional line can be added to cover contractors, managers and other individuals who may be involved with a site and therefore expose the business to liability. If these individuals have their own policies, it may not be necessary to cover them explicitly. However, many times these individual policies will not cover work done on the site. Professional liability may further cover errors and omissions in contracts (E&O). E&O insurance protects business owners from unknown exposures added through contracts with third parties as well as in-house omissions.

Premises Pollution

Premises pollution coverage is very similar to contractor's pollution insurance. It covers claims at a specific named location. Each location should be added to this policy prior to beginning work. A location can be as narrow or as broad as necessary. For example, a location with multiple storage tanks can be listed as one covered location. Alternately, each tank can be explicitly listed on the policy. 

Follow Form Excess

Excess insurance policies are in place to add additional limits beyond what is covered under each individual line. Follow form excess is not necessary for every storage tank contractor. If you are uncertain whether this line is necessary for you, consider asking an insurance broker if you are carrying enough coverage as is or need additional coverage through this excess line.

Auto Insurance

If you use vehicles in your business operations, you must carry an auto insurance policy under your business. This line of coverage is particularly important if you operate heavy machinery in your storage tank operation, such as a vacuum truck or other vehicle used for moving large pieces of material. Any worker who is operating an automobile in the name of the business or while in the line of business must be added to the auto insurance policy for the business to remain protected from loss. 

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