Oil leaks and spills from residential fuel tanks have cost Canadian insurance companies and homeowners a lot of money in recent years. Insurance companies now balk at insuring homes with older fuel tanks, and some provinces have passed strict new regulations governing when the tanks must be replaced.

The Insurance Bureau of Canada (www.ibc.ca) Atlantic region says that insurance claims from domestic oil tank leaks increased by more than 50 per cent in recent years. In the Atlantic region alone, between 1996 and 1998, total claims were more than $11.9 million. That ranks sixth in consumer claims after fire, wind and water damage, burglary and liability.

The increase in the number of oil spills, and the resultant damage to the environment, prompted Prince Edward Island, Canada's smallest province, to become the first in the country to adopt tough new regulations for oil tank installations. PEI's Department of Fisheries, Aquaculture and Environment conducted a study in 2000 that showed 63 per cent of home fuel tanks did not meet the ministry's installation standards. New regulations allow only licenced installers to place new or replacement tanks in homes, and tanks must be replaced every 15 to 25 years, depending on the tank design and steel thickness.

In Ontario, fuel oil distributors may not supply fuel oil to an underground tank unless it is registered with the province's Technical Standards Safety Authority. Regulations have been established for when underground tanks must be removed or upgraded, and even a tank that is no longer in use must be removed within two years, no matter how old it is. Tanks that are in the basements of homes, or above-ground, do not have to be registered. Ontario's legislation has not set an age at which above-ground tanks must be replaced, but insurance companies may not be willing to insure an older tank.

PEI's environment ministry says nearly all fuel oil tanks corrode from the inside out, and that inevitably, through condensation and other means, sludge and water accumulates at the bottom of every tank, which causes the corrosion. Outdoor installations are more susceptible to condensation because of day-night temperature changes.

Most tanks hold about 1,000 litres of fuel, and weigh about 1,000 kg (one ton) when they are full. The strange shape is to allow them to fit through standard doorways, but it also makes them unstable and major spills sometimes happen when a leg breaks off. Tanks should have secure supports to make sure they won't tip over.

For basement and above-ground tanks, the Ontario Ministry of the Environment offers a checklist for homeowners, which should be used for an annual inspection. If the answer to any of the following questions is yes, homeowners should call a registered contractor for assistance.

  • Are the tank legs unstable or on a shaky foundation?
  • Are there any signs of rust, weeping, wet spots or excessive dents on the tank?
  • Are there any drips or signs of leakage around the filters or valves?
  • Is there danger of snow or ice falling on the tank?
  • Is the vent clogged or restricted because of snow, ice or insect nests? Screened vents can help prevent insect nest problems.
  • Is the vent whistle silent when the tank is being filled?
  • Are there signs of spills around the fill pipe or vent pipe?
  • Is the fuel-level gauge cracked, stuck or frozen? Are there signs of oil around it?

    An underground tank is tougher to inspect, but the biggest tip-off it may be leaking is if your home is using more fuel than normal.

    PEI says domestic oil spill cleanup costs can be more than $150,000, and that common spill cleanups can easily cost $5,000. It says just one litre of leaked oil can contaminate one million litres of drinking water.

    Even after a basement fuel tank has been removed, disaster can strike if you don't remember to remove the access pipe from outside. A relative of mine who lives in a rural area had switched to electric heat and removed the oil tank, but the old access pipe on the outside of the house was still there. A fuel delivery truck came to the wrong address, and pumped the basement of the home full of oil.

    Fortunately for the homeowners, the insurance company paid the bills, but it was months before the house was fit to live in again.

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