What is Storage Tanks Insurance (Aboveground and Underground)?
Storage tanks insurance covers the costs associated with leaks, spills, on-site cleanup, and third‑party liability for tanks that hold petroleum products, chemicals, pesticides, paints and other liquid toxic substances. Coverage can be written for both underground storage tanks (USTs) and aboveground storage tanks (ASTs), and policies are underwritten with attention to environmental liability, property coverage, and commercial liability exposures.
Given the nature of the substances likely to be stored, regulations often require operators to adhere to strict safety protocols and environmental standards. Therefore, having the right insurance coverage is essential in managing potential contractual obligations and compliance expectations effectively.
Who needs it
Operators that commonly seek tank coverage include refineries, bulk plants, fuel distributors, chemical manufacturers, retailers with on-site storage, and contractors who store or handle hazardous liquids. Smaller specialty operations — for example, fuel retailers and propane dealers — often combine tank coverage with broader liability programs like Small Propane Dealers Insurance or choose standalone tank policies depending on their exposures.
What it typically covers
The same underwriters that write underground storage tanks also write similar coverage on aboveground tanks. Refineries and bulk plants are likely candidates for aboveground tanks coverage. Underwriters can cover chemical, paint, pesticides and other liquid toxic substances in this program. There is no age restriction on tanks but older tanks are generally charged higher premiums. These policies provide on-site cleanup and third-party liability.
Typical elements include: cleanup and remediation costs, third‑party bodily injury and property damage liability, sudden and accidental pollution coverage, and sometimes limited first‑party property or equipment coverage. Policies are often paired with commercial liability or environmental liability programs to cover related exposures.
Common exclusions or limitations
Policies commonly exclude long‑term gradual pollution, certain regulatory fines and penalties, intentional acts, and damage from poor maintenance or known pre‑existing conditions. Look for limits on pollution cleanup, sublimits for third‑party claims, and exclusions tied to transportation risks or off‑site contamination. Underwriting factors and exclusions should be reviewed carefully with your broker.
Factors that influence cost
Premiums and terms depend on underwriting factors such as tank age and construction, secondary containment, maintenance records, tank contents (e.g., gasoline vs. solvents), proximity to water sources, and prior loss history. Operational hazards, transportation risks during fuel delivery, and the presence of monitoring and leak detection systems also affect pricing. Older tanks or sites with a history of leaks typically face higher premiums and more restrictive terms.
Proof of insurance & compliance
Many local authorities and contractors require evidence of pollution liability or tank coverage before granting permits or signing contracts. Certificates typically show policy limits and named insureds; some projects require additional insured endorsements or specific wording from an environmental or general liability policy. For broader liability needs, operators may combine tank coverage with programs such as General Liability/Environmental Insurance Program or select a tailored option like Monoline Liability Insurance.
How to get a quote
To get an accurate quote, gather basic site information (tank type, capacity, age), contents, maintenance and inspection records, and any loss history. Discussing site controls and risk management measures can improve terms. If you’re unsure which coverages you need, talk to your agent and provide the site details — talk to your agent.
Frequently Asked Questions
Do insurers deny coverage for older tanks?
Not automatically. Older tanks may be accepted but often face higher premiums, stricter exclusions, or requirements for upgrades and inspections.
Will a standard general liability policy cover a leak?
Most standard general liability forms exclude pollution or gradual contamination; a specialized pollution or tank policy is usually required for cleanup and related liabilities.
Are on-site cleanup costs covered?
Yes — many tank policies include on-site cleanup and remediation, though limits and sublimits may apply depending on the policy wording.
Still have questions? Talk to a local insurance expert.