No insurance for decommissioned oil tank?

What to do???  

I purchased my home in 1980. The home that was built in 1950 it has an underground oil tank that was in use until the mid-1980’s in 1995 I had the tank inspected approved and filled with sand only to find out that this is no longer acceptable.

I'm in a dilemma about what to do about it, if anything. Its driving me crazy.  The tank is within feet of the property line to my neighbor’s property and I  have no insurance to cover any the costs and after reading some of the stories on line its putting me into a depression.   The tank was covered by my home owners at the time it was filled but I found out that no insurance every paid after the fact. When I changed insurance policies later on I told them that there was a decommissioned tank in the ground with all the required closing permits they told me there was no longer a need to insure a permitted sand filled tank. Thanks for that!     

I know after 23 years of being filled with sand the tank is corroded and the soil will have to be tested and if the soil is contaminated a lien is put onto my home by the EPA and stays on it until the problem is resolved.

 Here I thought I was doing the right thing by having it filled.  I’ve been sick about this ever since I found out that what was approved by the state and town then is no longer any good. I wanted some peace in my golden years it doesn’t seem like this is going to happen. I feel so upset you can’t imagine  how this has affected my life on a daily basis.

Do I bit the bullet and have the tank removed now regardless if the costs $$$ and face bankruptcy or do I just stay put until I die?        

Technically having the tank cleaned and filled with sand is allowed by law.  It is homebuyers and mortgage companies who won't touch those properties. 

My mom is in the same boat, except with TWO tanks (large two family house) and she's also been putting it off.  From what I've read in the 2,000+ threads on this subject, she may have insurance coverage due to the fact that when the tank was still in use she had it insured, so the last policy on file (and the policy that was in effect at the time that any leakage would have occurred) was in her name. 

spontaneous said:

Technically having the tank cleaned and filled with sand is allowed by law.  It is homebuyers and mortgage companies who won't touch those properties. 

My mom is in the same boat, except with TWO tanks (large two family house) and she's also been putting it off.  From what I've read in the 2,000+ threads on this subject, she may have insurance coverage due to the fact that when the tank was still in use she had it insured, so the last policy on file (and the policy that was in effect at the time that any leakage would have occurred) was in her name. 

I talked to a few of the companies that pull the tanks they told me that no insurance company ever paid after the fact even though it was insured and inspected at the time  .

 I also called the insurance company that I had at  the time the tank was filled they told me that they (might?) only cover liability I would have to submit a  claim to them and they would pull the archived policy and see it would be nice to know which is true?? I wonder if anyone ever had an insurance company pay after the fact I wish it was true.    

Look, if it is causing you this much stress pull the tank.  Deal with it now to have it over with.

pals23 said:

What to do???  

I purchased my home in 1980. The home that was built in 1950 it has an underground oil tank that was in use until the mid-1980’s in 1995 I had the tank inspected approved and filled with sand only to find out that this is no longer acceptable.

I'm in a dilemma about what to do about it, if anything. Its driving me crazy.  The tank is within feet of the property line to my neighbor’s property and I  have no insurance to cover any the costs and after reading some of the stories on line its putting me into a depression.   The tank was covered by my home owners at the time it was filled but I found out that no insurance every paid after the fact. When I changed insurance policies later on I told them that there was a decommissioned tank in the ground with all the required closing permits they told me there was no longer a need to insure a permitted sand filled tank. Thanks for that!     

I know after 23 years of being filled with sand the tank is corroded and the soil will have to be tested and if the soil is contaminated a lien is put onto my home by the EPA and stays on it until the problem is resolved.

 Here I thought I was doing the right thing by having it filled.  I’ve been sick about this ever since I found out that what was approved by the state and town then is no longer any good. I wanted some peace in my golden years it doesn’t seem like this is going to happen. I feel so upset you can’t imagine  how this has affected my life on a daily basis.

Do I bit the bullet and have the tank removed now regardless if the costs $$$ and face bankruptcy or do I just stay put until I die?        

Having just dealt with this, I would suggest splitting it into 2 separate actions...1-Pull the tank, and have the soil examined to determine if any contamination has occurred. If the soil is clean, you're done. 2-If there is contamination, a good contractor, like Mike Waters, will be able to estimate the cost of any cleanup. Then refill the hole until you have the $$$ to do the remediation. 

I was told that there is no law specifyin the time frame in which you must clean it up, so it gives a bit of flex. Most important, though, is that you'll have the knowledge of the situation, instead of wondering and thinking the worst.

There may be no contamination.  We had our decommissioned oi tank removed when we redid the driveway (tank was underneath). Town inspected, found no contamination, and gave us papers attesting to that fact. No more stress or worry.  IMHO, it is better to know what if anything you are facing than to remain stressed.  

Dennis_Seelbach said:

pals23 said:

What to do???  

I purchased my home in 1980. The home that was built in 1950 it has an underground oil tank that was in use until the mid-1980’s in 1995 I had the tank inspected approved and filled with sand only to find out that this is no longer acceptable.

I'm in a dilemma about what to do about it, if anything. Its driving me crazy.  The tank is within feet of the property line to my neighbor’s property and I  have no insurance to cover any the costs and after reading some of the stories on line its putting me into a depression.   The tank was covered by my home owners at the time it was filled but I found out that no insurance every paid after the fact. When I changed insurance policies later on I told them that there was a decommissioned tank in the ground with all the required closing permits they told me there was no longer a need to insure a permitted sand filled tank. Thanks for that!     

I know after 23 years of being filled with sand the tank is corroded and the soil will have to be tested and if the soil is contaminated a lien is put onto my home by the EPA and stays on it until the problem is resolved.

 Here I thought I was doing the right thing by having it filled.  I’ve been sick about this ever since I found out that what was approved by the state and town then is no longer any good. I wanted some peace in my golden years it doesn’t seem like this is going to happen. I feel so upset you can’t imagine  how this has affected my life on a daily basis.

Do I bit the bullet and have the tank removed now regardless if the costs $$$ and face bankruptcy or do I just stay put until I die?        

Having just dealt with this, I would suggest splitting it into 2 separate actions...1-Pull the tank, and have the soil examined to determine if any contamination has occurred. If the soil is clean, you're done. 2-If there is contamination, a good contractor, like Mike Waters, will be able to estimate the cost of any cleanup. Then refill the hole until you have the $$$ to do the remediation. 

I was told that there is no law specifyin the time frame in which you must clean it up, so it gives a bit of flex. Most important, though, is that you'll have the knowledge of the situation, instead of wondering and thinking the worst.

The problem is that if the soil extends under the house then the clean up is every expensive. This is not a rare occurrence. Sommer Ave in Maplewood had a few houses where they had to dig underneath the homes (and one where they actually removed the home from the foundation), and @metaphysician has pictures of how they had to dig underneath his home to remove contaminated soil.

Once the contamination reaches underneath the foundation the cost of remediation is beyond what the average homeowner can afford.

You are technically correct, but perhaps unnecessarily alarmist at the moment.  

FilmCarp said:

You are technically correct, but perhaps unnecessarily alarmist at the moment.  

When my mother purchased her home one of the tanks had already been abandoned, yet the house hadn't been converted to gas, they simply used the second tank, which leads to the question of WHY they abandoned the one tank if there was nothing wrong with it.  However, as a first time homeowner at that time she didn't inquire as to if it had been properly decommissioned, etc.  She now realizes that the first tank was likely abandoned for a reason (like it may have been leaking) and she is now responsible for something that happened 40+ years ago.

Oh, and my grandmother's home also had a leaking tank, which luckily was covered by tank insurance.  Her tank was only 50 years old unlike the 80+ year old tanks many Maplewood and South Orange has, yet it leaked like a son of a ***** and also required a massive clean up.

But yeah, I'm being alarmist. 

pals23 said:

I talked to a few of the companies that pull the tanks they told me that no insurance company ever paid after the fact even though it was insured and inspected at the time  .

 I also called the insurance company that I had at  the time the tank was filled they told me that they (might?) only cover liability I would have to submit a  claim to them and they would pull the archived policy and see it would be nice to know which is true?? I wonder if anyone ever had an insurance company pay after the fact I wish it was true.    

Several people on MOL have posted accounts of massive oil tank cleanup operations ($100,000+) that were covered by insurance. Who was the poster who moved to Maine? And metalibrarian (did I get that name right?) I'll see what I can find later today. I followed this subject pretty obsessively since I had an in-ground tank. It seemed that all the real horror stories did end up being covered by insurance. 

I pulled my tank at a time of great financial difficulty because I couldn't deal with the daily stress of having a ticking time bomb in my back yard. So glad I did. It was clean.

FilmCarp said:

You are technically correct, but perhaps unnecessarily alarmist at the moment.  

reading this is the kind of thing is what is driving me crazy 

Right.  Posting horror stories does not help you.  Pull the tank and then sleep well.  Most pulls are clean and done.

metalibrarian puts on a very boring live show. 

It's like - I get it you're librarians - but there's no need to whisper.

spontaneous said:



But yeah, I'm being alarmist. 

Yeah, you are. But the bottom line is that the tank will have to be pulled sooner or later. If there is contamination, it will have to be remediated sooner or later. I would much rather take step 1 NOW,  and KNOW what the future holds than to "wish" it would all go away. Then, go about amassing the resources needed to do the remediation.

I believe @lisat was able to get older insurance company to pay for huge remediation. I also believe that the costs for remediation seem to rise exponentially when they find out you're insured...

kthnry said:

pals23 said:

I talked to a few of the companies that pull the tanks they told me that no insurance company ever paid after the fact even though it was insured and inspected at the time  .

 I also called the insurance company that I had at  the time the tank was filled they told me that they (might?) only cover liability I would have to submit a  claim to them and they would pull the archived policy and see it would be nice to know which is true?? I wonder if anyone ever had an insurance company pay after the fact I wish it was true.    

Several people on MOL have posted accounts of massive oil tank cleanup operations ($100,000+) that were covered by insurance. Who was the poster who moved to Maine? And metalibrarian (did I get that name right?) I'll see what I can find later today. I followed this subject pretty obsessively since I had an in-ground tank. It seemed that all the real horror stories did end up being covered by insurance. 

I pulled my tank at a time of great financial difficulty because I couldn't deal with the daily stress of having a ticking time bomb in my back yard. So glad I did. It was clean.

kthnry said:


 And metalibrarian (did I get that name right?) 

I think you're talking about metaphysician

Dennis_Seelbach said:

spontaneous said:



But yeah, I'm being alarmist. 

Yeah, you are. But the bottom line is that the tank will have to be pulled sooner or later. If there is contamination, it will have to be remediated sooner or later. I would much rather take step 1 NOW,  and KNOW what the future holds than to "wish" it would all go away. Then, go about amassing the resources needed to do the remediation.

After my grandmother's tank was pulled, after the clean up was completed, after the state finally issued a NFA letter, we still had to deal with the legacy of the oil tank.  When we sold the home a sweep of the yard got a hit where the tank used to be.  It was the pipes, but still caused some issues.  Also, due to the leak having reached groundwater a testing well had been installed for a year after remediation.  The buyer wanted proof that the well had been properly capped.  It's easy to say "walk away and find a new buyer" but reality is different, buyers aren't going to willing walk into a potential nightmare. 

Many tanks in this area were installed in the 20's so they've had decade upon decade to corrode and leak.  If there is a leak remediation without insurance can easily bankrupt people.  This isn't being alarmist, this is fact. 

I just thank my lucky stars that when I purchased my home, at the time not knowing about these potential time bombs in people's yards, I was lucky enough to have a house that never had oil heat.  My house apparently went straight from coal to gas.

Geez, it's been a loooooong time since I've posted here. Spontaneous alerted me to the activity in this thread.

Pals23, try to calm down. You don't have an ancient tank of unknown condition filled with hundreds of gallons of fuel oil, lurking like a time bomb.

You have a tank that you had inspected, cleaned, filled with sand, approved, and decommissioned in 1995. The worst thing you should find is a rusty tank. No one cares about rust. Get it yanked and backfilled. In the remote chance that there actually is any oil contamination, then you have a lawsuit against the company that did the original work. The State would come down on THEM like a ton of bricks, but that situation is incredibly unlikely because the town HAD to inspect and approve the site. 

Our situation was very different. We had an active 50 year old tank under a driveway. One fine day, our oil company said, "Uh. folks, you're missing about 300 gallons of oil."  I won't belabor the next 5 years, I'll just post the same picture I've posted in the past. The front of the house is on the right. The monstrous machine is approaching it from the neighbor's property on the left side, digging under the garage in that corner. 

I know it cost in excess of $130,000, but not how far in excess. We had a Proguard policy on the tank (I have little praise for them) but our Homeowners insur. picked up most of the cost. Some time before the occurrence, they called us and said,"You need a policy rider on your tank." I said why? We have Proguard. They told us Proguard covered us only. "What if it crosses over your property line? You need the rider to cover your neighbor..." So, we got the rider, which saved our hides. Yes, it would have bankrupted us.

That was then; this is now. No one offers policy riders like that any more. Proguard is bigger than ever.

And Pals23, you're nowhere near our situation. You have a tank full of sand. Get it removed to ease your mind.

Wow that is some clean up I cant believe that they would make a home owner go thru something like this.

this is not the catastrophe people are making it out to be.  It is extremely rare that any in ground oil tank would cost 100k or more to clean up.  Usually, the most expensive  cases involve ground water contamination and/ or contamination of neighboring property which  most insurance policies cover.  I've been a realtor for 22 years.  During that time , of tens of  thousands of houses sold in towns that I cover  i am aware of between 5 and 10 that may have cost that much and all were covered by insurance. Of course, there may be some that I am not aware of. I agree that in those very rare, extreme cases either insurance or a state fund should cover.  Maybe there should be a tax on carbon based home heat - heating oil, natural gas, etc, because that money has to come from somewhere.  

  In a typical case of contamination, remediation costs around $10,000. If its really bad of can be up to 20k.  Of course thats a lot but it's no more than a new roof  or boiler and when one is selling a 600k house it's not going to spell financial ruin.  Also, there is no law requiring that properly decommissioned oil tanks be removed from a property.  This is a function of the litigious society we live In.  Attorneys recommend to their clients that they demand oil tanks be removed.  Sellers want to sell their houses so they do it.  They are not required by law to do so.   

Every homeowner who decommissioned an oil tank was given the choice of leaving it in the ground, or of spending $300 to 500 more to have it removed.  Every company I ever encountered always recommended removal.  I always recommended removal.  Most attorneys recommended removal.   It wasn't worth leaving a potential problem, n the ground for $500.  So now some of the people who opted for the cheaper way are getting caught.  When that happens why should the rest of us pay through taxes or higher insurance rates to cover their costs.

By the way, one earlier post mentioned an inspection that failed to discover an oil tank.  That is beyond the scope of any home inspection.  No home inspection ever will include checking for an in ground oil tank.  A typical home inspection may look for indications through piping in the basement but at least since I've been a realtor buyers are always strongly advised to get a tank sweep. 

This is good information Im still at odds as with what to do I certainly want to get my wife on broad with her approval because is something does go wrong I would never hear the end of it. The whole process still unnerves me I always thought I was in good shape with the tank being filled with sand and sealed and permited 

Pal,  Since when you properly decomissioned your tank it was found to have no leaks, it is likely ( though not guaranteed) that when you pull it, it will be clean.   I believe that the cost of a removal ( if there are no problems) is between $1600 and $2000.   If it is found to have contamination the cost will probably be around $10,000.   Are you planning to sell your house soon.  If so , remove the tank ASAP.   Give yourself enough time to do the removal and remediation (if needed) long before your house goes on the market.   If you are not planning to sell then there is no pressing need for removal.   It also depends on your financial situation.  If you can afford the $$$$ now then there is no need to wait.  

I don't blame my mother for being nervous.  She had the one tank properly decommissioned and left in place, if there was any leakage it is underneath the tank since the soil on the top and sides tested clean.  But the second tank was abandoned before she bought the property and she doesn't even know if it was decommissioned or if the previous owners just stopped using it and did nothing.  She doesn't even know when it was abandoned, just that it was sometime between 1929 and 1980.  I'm trying to convince her to handle this now (she had a tank policy in her name so any leakage that occurred should be covered since it could not have occurred after the tank(s) were decommissioned) but it is the unknown variable of the second tank that is spooking her. 

Right now her "plan" for dealing with this is to just never move so she doesn't have to deal with selling the house.

spontaneous said:

I don't blame my mother for being nervous.  She had the one tank properly decommissioned and left in place, if there was any leakage it is underneath the tank since the soil on the top and sides tested clean.  But the second tank was abandoned before she bought the property and she doesn't even know if it was decommissioned or if the previous owners just stopped using it and did nothing.  She doesn't even know when it was abandoned, just that it was sometime between 1929 and 1980.  I'm trying to convince her to handle this now (she had a tank policy in her name so any leakage that occurred should be covered since it could not have occurred after the tank(s) were decommissioned) but it is the unknown variable of the second tank that is spooking her. 

Right now her "plan" for dealing with this is to just never move so she doesn't have to deal with selling the house.

Suggest that she go to the code enforcement office at town hall (2nd floor).  If the 2nd tank was decommissioned, staff there should have a record and can give her a copy.  Obviously, if it was just abandoned, there will be no record.  Still, it is worth the few minutes it will take to ask.

Pal23, Sarahzm is giving you good advice. She's a highly respected realtor   with a lot of experience in our area. My situation was highly unusual, and I post that picture mostly for the amusement value. We survived, our home is fine, and we have our NFA letter from the state hidden in a dozen place, since I consider it the most valuable thing we own. We love our house and our neighbors and the wonderful town we live in.

That's a most unfair characterization! Many years ago, when we decommissioned our tank, it was presented to us by all concerned (including the town!) as a perfectly acceptable alternative. Hindsight is great, but at the time, the cheaper solution was not viewed as problematic, and to say otherwise now is misleading. We got "caught," to use your word, because the rules changed, not because we did anything foolish. 

Incidentally, a similar situation occurred with asbestos-insulated heating pipes. We were originally told we could encapsulate them. Then, years later, the consensus became that we had to remove the asbestos entirely. 

It would not surprise me if in years to come the attitudes change about non-copper pipes within the house--i.e., all must be changed to copper. Already when we sold our house, the buyer demanded we change out the short length of pipe running from the main into the house. Our realtor told us this was only the second such request she'd heard in eleven years. We'll see.

sarahzm said:
Every homeowner who decommissioned an oil tank was given the choice of leaving it in the ground, or of spending $300 to 500 more to have it removed.  Every company I ever encountered always recommended removal.  I always recommended removal.  Most attorneys recommended removal.   It wasn't worth leaving a potential problem, n the ground for $500.  So now some of the people who opted for the cheaper way are getting caught.  When that happens why should the rest of us pay through taxes or higher insurance rates to cover their costs.

Here is something important to be learned.  In real estate you NEVER EVER know what is coming around the corner.   So if there is a potential problem like asbestos or an in ground oil tank HAVE IT REMOVED even if it costs a little extra.   That way no matter how the measure of acceptability changes, your potential problem will be long gone. 

And yes, even though encapsulating asbestos was  acceptable (and cheaper)  , smart or well advised homeowners spent the extra money to have it taken out.  

Re piping - was your water main lead ?  The only justification for demanding a seller replace a water main would be that it is lead ( which is toxic and can poison the water supply)  or that it is not sound - and I've never seen that.    In 22 years in real estate I've encountered 2 water supply pipes that were lead and every buyer justifiably insisted that they be replaced. 

Everyone's a genius after the fact. 

And for your information, lead was used in numerous service lines connecting older houses to water mains in the street. It wasn't banned in New Jersey until 1986/1987. No one made a big deal of it around here until Flint, Michigan hit the news.

sarahzm said:

Here is something important to be learned.  In real estate you NEVER EVER know what is coming around the corner.   So if there is a potential problem like asbestos or an in ground oil tank HAVE IT REMOVED even if it costs a little extra.   That way no matter how the measure of acceptability changes, your potential problem will be long gone. 

And yes, even though encapsulating asbestos was  acceptable (and cheaper)  , smart or well advised homeowners spent the extra money to have it taken out.  

Re piping - was your water main lead ?  The only justification for demanding a seller replace a water main would be that it is lead ( which is toxic and can poison the water supply)  or that it is not sound - and I've never seen that.    In 22 years in real estate I've encountered 2 water supply pipes that were lead and every buyer justifiably insisted that they be replaced. 

People have been making a big deal about lead since long before Flint, and I think the use of lead as pipes or in pipe solder was banned well before the 80's.  Perhaps they weren't ordered removed until the 80's.

unicorn33 said:

Everyone's a genius after the fact. 

And for your information, lead was used in numerous service lines connecting older houses to water mains in the street. It wasn't banned in New Jersey until 1986/1987. No one made a big deal of it around here until Flint, Michigan hit the news.

sarahzm said:

Here is something important to be learned.  In real estate you NEVER EVER know what is coming around the corner.   So if there is a potential problem like asbestos or an in ground oil tank HAVE IT REMOVED even if it costs a little extra.   That way no matter how the measure of acceptability changes, your potential problem will be long gone. 

And yes, even though encapsulating asbestos was  acceptable (and cheaper)  , smart or well advised homeowners spent the extra money to have it taken out.  

Re piping - was your water main lead ?  The only justification for demanding a seller replace a water main would be that it is lead ( which is toxic and can poison the water supply)  or that it is not sound - and I've never seen that.    In 22 years in real estate I've encountered 2 water supply pipes that were lead and every buyer justifiably insisted that they be replaced.