Need Storage Tank Pollution Coverage? SWG Will Consider Any Age and Construction Type

April 15, 2020

Since 2008, the Canadian government has introduced new regulations to help reduce the risk of releases of oil and gas products. At the time, 15% of active storage tank systems were more than 20 years old and had no leak detection, corrosion protection, or structure to contain leaks and spills. (1)

Storage tanks are employed in a range of essential industries across Canada, and many of them still lack the financial protection to cover releases.

Storage Tank Environmental Insurance (STEI) policy addresses the pollution risks associated with specified aboveground and underground storage tanks, including integral piping, fill points, dispensers, pumps, and vapor recovery systems. Coverage is provided on a claims-made and reported basis.

Why Tank Owners Need Pollution Liability Insurance

What the client doesn’t know can hurt them. Gradual leaks are a common risk, and can happen as a result of:

Improper installation

Inadequate maintenance

Poor monitoring of the storage tank

In addition, hazardous spills can occur whether the tank is in use or in storage. When in use, tanks are at the greatest risk of leakage when in transport, especially at transfer areas. Storage tanks that are no longer in use also pose a liability hazard and should be safely emptied and removed from the premises.

All storage tanks corrodeor deterioratewith age and should be monitored for leak detection. These warning signs include:

  1. Visible signs of corrosion on the tank body and adjacent piping
  2. Stains in the area surrounding the fuel tank
  3. Oily residue in nearby streams and drainage areas
  4. Dead grass and vegetation in the area surrounding the fuel tank

Types of legal action taken against a client for a leak or spill vary. They could include bodily injury, third-party property damage or third-party contamination. First-party cleanup is another major cost, and companies without the right insurance are often unprepared for the consequences of an unfortunate pollution event.

SWG ENVIRO Coverage Highlights:

Storage Tank Environmental Liability ensures that clients have readily available coverage for a host of potential costs, including:

Sudden and gradual pollution events

On-site and off-site clean-up costs

Emergency response costs (72 consecutive hours from discovery)

Natural resource damages

Compensation for third party bodily injury and property damage

Civil fines and penalties, where insurable by law

Punitive damages, where insurable by law

Legal defense costs

Loading and unloading

Whereas many insurance providers put age-based restrictions on coverage, SWG will consider tanks of any age and construction type. This is subject to satisfactory underwriting and review of documentation such as Phase Reports a/o Integrity (tightness) test results.

Coverage enhancements include:

Retroactive cover for historic pollution

Storage tank decommissioning and replacement works

Transported cargo – including loading/unloading.

Waste disposal / Non-owned disposal sites

Our coverage includes but is not limited to the following. Contact us if you don’t see what you’re looking for:

Gas bars, service stations, and convenience stores

Bulk fuel terminals



Truck stops

Auto dealerships and car rental agencies


Residential units

And more

Visit our website for more details.

Content is current as of the date of broadcast and is subject to change without notice.