Legislation would require heating oil spill insurance

Michael Morton

Just 10 days after workers removed a pool of leaked heating oil from her utility room, Hopkinton resident Pamela Duffy woke to a strange smell and went down to the space to investigate.

"There it was," she said, recounting the 2001 incident yesterday. "Oil. One-half-inch to 1-inch deep."

After the first spill, her oil dealer took responsibility for cleaning up the mess. But with the second leak, the company did not immediately respond and Duffey summoned the Fire Department. As they went about removing the oil with a hazardous materials team, she called her insurance agent and discovered her homeowner's policy did not cover such accidents.

"I wasn't super worried because I thought any expenses would be covered by the oil dealer's insurer," she said.

The incident triggered a multiyear quest to deal with fallout from the spills. To begin with, Duffy developed flu-like symptoms and breathing problems from lingering oil fumes.

When a contractor dug a test trench in her downstairs living room in response, he discovered a plume of residual heating oil gathered under the floor. Duffy sued the oil supplier and its insurance company. She left her home for three years before returning after a settlement was reached.

"That was the hardest part," she said. "That ongoing stress and anger." She said during her absence the house deteriorated further.

Seeking to spare homeowners similar pain, state Sen. Pamela Resor, D-Acton, has again filed legislation requiring insurance companies to include coverage for heating oil spills. After passing in the Senate for the third time recently, the bill sat in the House Ways and Means Committee again last night. With the legislative session ending today, Resor is watching to see if her proposal will finally be released for a vote.

"I think this would help a lot of people and give them a little more security," Resor said. "It's a serious issue when these spills happen."

Currently, insurance companies are only responsible for expenses incurred when spilled heating oil contaminates water sources or adjacent properties. While some firms have started covering home cleanup and property damage, such policies typically offer limited compensation and are mainly intended to limit liability, said Chris Davis, a partner at Boston law firm Goodwin Procter and the volunteer chairman of a coalition supporting Resor's legislation.

Under the proposed bill, all state policies would be required to offer at least $50,000 in coverage for remediation and damages inside homes and $200,000 for claims made against homeowners by third parties like neighbors.

In turn, the insurance companies will be allowed to implement a reasonable premium boost, which Davis estimates will cost consumers $20 a year. Homeowners will also be required to upgrade older heating equipment with safety systems, a one-time expense projected at $100 to $200.

While Davis said oil spills have declined as older systems are replaced, he estimates there are still 250 to 300 state cases annually. In response to the issue, a coalition has formed that includes environmentalists, lawyers, the heating oil industry, engineers, banks, real estate agents and the Massachusetts Municipal Association.

Neither the Massachusetts Insurance Federation nor the Massachusetts Association of Insurance Agents could be reached for comment. Referring to the industry, Davis said, "We've been told they're unenthusiastic, but we haven't seen any evidence of lobbying against it."

While her saga has drawn to a close, Duffy still follows the proposed legislation. Had it been in place before 2001, she said, her insurance company might have pushed for a more thorough house examination and potentially resolved the situation more quickly. If so, she added, she would not have been exiled for so long, an absence that left her home to be further wrecked by mold and vermin.

"It certainly wouldn't have cost nearly as much if it hadn't dragged out for so long," she said.

While the legislation was again held in Ways and Means for reasons unknown to Davis and Resor, they both said they hoped success would be realized this session.

If not, "I assume we'll just keep trying to push the rock up the hill," Davis said.

Michael Morton can be reached at 508-626-4338 or

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