Massachusetts Real Estate

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Massachusetts Oil Heating Upgrading and Insurance Law

Massachusetts Oil heating and insurance law As of July 1, 2010 any home that is serviced by an oil fired heating system in Massachusetts must comply with a new law that requires home owners to upgrade their system equipment to prevent leaks. The new legislation is designed to prevent leaks from pipes and equipment that connect to your furnace.

The new law is addressed in Chapter 458 of the Acts of 2008. The two biggest provisions of the law change include the following:

  • The installation of either an oil safety valve or an oil supply line with a protective sleeve on systems that do not already have these devices in place.
  • Insurance companies that provide home owners insurance policies must offer coverage for oil tank leaks from heating systems that use oil.

What is important to note is that most home owners policies do not currently include coverage for oil leaks leaving home owners to fend for themselves with costly clean up bills. The new law makes it mandatory for insurance companies to offer coverage, however it is up to the individual home owner to purchase this optional insurance. Implementation of the insurance coverage will also start as of July 1, 2010.

Who must take action?

Homeowners of one to four unit dwellings that are heated with oil must already have or install an oil safety value or an oil supply line with a protective sleeve. Installation of these parts must be completed by a licensed oil burner technician.

If your home was built prior to January 1 1990, you are more than likely already in compliance with the new law because state fire codes were changed to require these parts on new installations at that time.

 

Who is exempt?

Homeowners are not required to comply with these leak prevention steps if the oil burner is

  • Located above the oil storage tank and the entire oil line is connected to and above the top of the tank.
  • An oil safety valve or oil supply line with protective sleeve was installed on or after January 1, 1990 and
  • The changes are in compliance with the oil burning equipment regulations. The copy of the oil burner permit from the local fire department may be used to demonstrate you are in compliance.

                                                                                                                                                      Massachusetts Oil leak

Complying with this new law is a no brainer! The cost of cleaning up an oil spill is very expensive. The cost of making this upgrade is very cheap. We are talking about a few hundred dollars to make these upgrades. Why take a chance and be left with a bill that could cripple you financially!

If you are unfortunate enough to have a leak and it reaches the soil beneath your home then a clean up is going to be necessary to bring your property back into compliance with state environmental standards. If the leak is severe enough and it impacts your neighbors or the local ground water supply the bill is going to be astronomical.

In Massachusetts, reports indicate that there are a few hundred spills a year. If you have a spill the cost for clean up on the low end is going to be $15000 to $20,000 dollars. A high end clean up can easily get into the hundreds of thousands! Who would ever want to deal with this kind of nightmare when it is so easy to avoid? I know if I owned a home that was built prior that 1990 I would not want to even think about such a catastrophe. I would make darn sure I was compliant right away!

 

 

What Kind of Insurance is available to home owners?

Massachusetts Home InsuranceIn order to be eligible for coverage you must make sure that your home is either compliant or exempt from the new law.

The insurance will provide "1st party coverage" of at least $50,000 to cover the expenses of cleaning up a leak to soils, indoor air, or other environmental media from a home heating system at the residence itself and also reimbursement for personal property damage.

Secondly you must provide for "third party coverage" of at least $200,000 for dealing with any problems that occurred as a direct result of the leak for damage off of the property. This could be a near by home or the local ground water. The insurance coverage will also include costs for legal fees subject to a deductible not to exceed $1000 per claim.

*** The key point to remember with the Massachusetts Oil Heating and Insurance law is that an an upgrade is more than likely be necessay only if your home was built prior to 1990.

A special thanks goes out to Rory Warren of Warren Home Inspections who made me aware that this new law would be going into effect. Rory mentioned there is some talk about asking home inspectors to police homeowners who are not compliant with the law at the time of a home inspection.

From a home inspectors perspective, I am sure they will not be too thrilled to carry the burden of this task.

If you are thinking of selling your home in Massachusetts one other law that is going into effect in Massachusetts concerning home safety is the Massachusetts Smoke Detector Law. You can read the complete article on the law by clicking the link. The basics of the new regulations is that as of April 5, 2010 you will be required when selling a home to have certain kinds of smoke detectors.

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About the Author: The above Real Estate information on Massachusetts oil heating upgrading and insurance law was provided by BillRE/MAX Executive Realty Metrowest Massachusetts Gassett, a Nationally recognized leader in his field. Bill can be reached via email at billgassett@remaxexec.com or by phone at 508-435-5356.

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26 commentsBill Gassett • February 05 2010 06:51AM

Comments

Wow Bill I have friends who live in Massachusetts. Knowledge is power!!

Posted by Mandy Buchholz (Benchmark Realty, LLC) over 4 years ago

Bill making a re-tro fit to save a spill should be a no brainer. Asking an inspector to start policing the law is beyond their requirements and is also against their codes. They are not supposed to point out code violations especially when those violations are for pre-code violations. This law is going to be a problem with some over zealous inspectors.

Posted by Ed Silva, Central CT Real Estate Broker Serving all equally (RE/MAX Professionals, CT 203-206-0754) over 4 years ago

Thanks Bill....great information....we should relay this to our sellers in advance of home inspections.....for sure that will come up in an inspection.

Posted by Barbara Todaro, "New Franklin MA Homes" (RE/MAX Executive Realty ) over 4 years ago

Bill - It is important to know all the recent information applicable to your community.  This is very useful info for everyone in your area.  Like Mandy said, Knowledge is Power indeed !

Posted by Christopher and Stephanie Somers - Realtors - Philadelphia Real Estate (Realtor / Owner - RE/MAX Access) over 4 years ago

Ed - I can see a lot of inspectors not wanting to be the snitch just the same.

Barbara - You are right if the issue is there a home inspector will point it out. Given that it is a major safety issue there are not going to be too many buyers that are going to let it go without a correction.

Mandy & Chrs - No doubt that being up to speed on new laws is important especially in the Real Estate industry.

Posted by Bill Gassett, Metrowest Massachusetts Real Estate (RE/MAX Executive Realty) over 4 years ago

We don't have much in the way of oil furnaces in our area but I am selling a home in the city that has an old tank and we are in the middle of having it removed. Hope we don't find any leaks.

Posted by Terry & Bonnie Westbrook, Westbrook Realty - Grand Rapids Forest Hills MI Re (Westbrook Realty Broker-Owner) over 4 years ago

Very interesting!  Oil burning furnaces are not something I am even familiar with in our area.  I will keep my eyes open if I run across one though.  Love your detailed information....always so thorough! 

Posted by Debbie Hutchins over 4 years ago

Bill the need to do this makes sense, but what I don't like is government stepping in and creating a Law that Mandates.  That usually opens the door for those who would provide the service, or the insurance to take advantage and charge higher prices.

In my opinion, government mandates are a great way to turn a good idea into a bad one.

Posted by George Souto, Your Connecticut Mortgage Expert (George Souto NMLS #65149 FHA, CHFA, VA Mortgages Connecticut) over 4 years ago

Terry & Deb - there are probably close to as many oil fired heating systems in Massachusetts as there are gas. It is common place to have an oil heating system.

George normally I would agree but we are talking about minimal money to bring a heating system into compliance. I am not sure the insurance companies would be the winners here either as a fw of these kinds of cases would cost quite a bit of money.

Posted by Bill Gassett, Metrowest Massachusetts Real Estate (RE/MAX Executive Realty) over 4 years ago

I recently saw a foreclosure listing in this area that said it had oil heat - first one and when we went to see it, looked just like a typical boiler and couldn't really tell.  I was thinkking there should be a tank or something where a truck comes and fills the oil tank - I had no idea that this is a common way to heat - at least (apparently) in Massachusett.  Now that this is in my view, I will probably see more of them - we shall see.

Posted by Cathy Tishhouse, Royal Oak Real Estate (RE/MAX Showcase Homes) over 4 years ago

Hi Bill.  Great post, as well as getting the message out early.  Home owners should have enough time to make any necessary repairs prior to the next heating season.   I'll also add a Thank You to Rory Warren.

Here is the link to the DEP fact sheet required by the new law.

I had not heard about home inspectors being involved with this law.  I'll bring it up at the next board meeting in March. 

I did read section 4, and interpret the language that the insurance policy may be refused unless the homeowner can supply proof that they comply with the new law.

Another thing to add to the checklist to make sure the closing can be done on time.

 

Posted by Jim Mushinsky (Centsable Inspection) over 4 years ago

Bill a spill is no laughing matter so this insurance is something that makes sense for the homeowners to do.  The other issue at least in my area was the buried oil tank, which can be a deal killer, so I always advice potential sellers to address the issue ahead of time.

Posted by Jennifer Fivelsdal, Mid Hudson Valley real estate connection ( JFIVE Home Realty LLC | 845-758-6842|162 Deer Run Rd Red Hook NY 12571) over 4 years ago

Jim - No doubt an important Massachusetts law that every homeowner should be aware of!

Jennifer - A buried oil tank is never a fun issue to deal with especially if there has been any kind of leakage.

Posted by Bill Gassett, Metrowest Massachusetts Real Estate (RE/MAX Executive Realty) over 4 years ago

Bill - This refit makes sense and it's cost seems fairly low. If had an oil burning furnace, regardless of where I lived, I would take heed to this post. Great information !

Posted by Claude Cross, Charlotte NC Homes For Sale (Claude Cross-Charlotte NC Real Estate(Homes By Cross, Inc.) ) over 4 years ago

Good information for folks in your area Bill. I wonder how much the homeowner's insurance premiums will increase for those who are giong to be impacted by this new law.

Posted by Patricia Beck, Colorado Springs Realty (RE/MAX Properties, Inc., GRI, CDPE) over 4 years ago

Bill, great post and information for your state.  Just as you stated,..."Complying with this new law is a no brainer"

Posted by Rebecca Gaujot, RealtorĀ®, Lewisburg WV Real Estate, Greenbrier County (Coldwell Banker Stuart & Watts Real Estate) over 4 years ago

Claude. Patricia & Rebecca - Massachusetts always seems to be instituting some new law. This one does happen to make quite a bit of sense. Given the impact to the environment from an oil spill this clearly seems like a good move!

Posted by Bill Gassett, Metrowest Massachusetts Real Estate (RE/MAX Executive Realty) over 4 years ago

Bill - This is very interesting, and something that we never think about here in Tennessee. Most of our homes have gas heat now, and it's a different kind of problem.

Posted by Larry Brewer, Nashville Real Estate (Benchmark Realty LLc) over 4 years ago

Thanks for the info. I had read about this new law coming into effect soon.

Posted by Suzanne Cutler, 617-549-5829, Braintree MA, MA Real Estate (Success! Real Estate) over 4 years ago

Hi Bill!  The rare buried tanks that we have here have been quite costly to remove and clean up and the process is quite lengthy as well.  The engineers do sampling after sampling, then the clean-up, then the state has to sign off on it, thus putting quite the price tag on the process.  It winds up being an added negotiation piece of the process as well.

Great info for your area; I think a well-needed legislation also!

Have a great day...

Posted by Debe Maxwell, Charlotte Homes for Sale - Charlotte Neighborhoods (www.AtHomesCharlotte.com | Savvy + Company Real Estate) over 4 years ago

Debe given the fact that the remedy is so cheap it makes perfect sense to get your heating system upgraded and then get the insurance coverage!

Posted by Bill Gassett, Metrowest Massachusetts Real Estate (RE/MAX Executive Realty) over 4 years ago

"If you have a spill the cost for clean up on the low end is going to be $15000 to $20,000 dollars."

Case closed. Everyone in Massachusetts needs to do this.

Posted by Sharon Alters, Your Fleming Island Relocation Agents. (Coldwell Banker Vanguard Realty) over 4 years ago

Bill - This is such important imformation for people to have.  I would imagine that many are confused about this legislation.

Posted by Pam Dent, Realtor - Charlottesville Virginia Homes and Horse Farms (Gayle Harvey Real Estate, Inc.) over 4 years ago

Hi Bill, I haven't seen oil furnaces in GA. You're providing great info for people who have them in Massachusetts though. I'm sure many people don't know the insurance coverage for them is an add on to their policy and not automatic.

Posted by Jen Bowman, Realtor - Anna Maria Island & Bradenton FL (Keller Williams Realty) over 4 years ago

One of the things I did not realize from reading the comments is that oil heat is not that common in quite a few areas.

Posted by Bill Gassett, Metrowest Massachusetts Real Estate (RE/MAX Executive Realty) over 4 years ago

Quite interesting. I've only found one oil burner here in San Diego, a unit built in 1938. It was still going strong as far as heating goes, but it was leaking oil all over the place.

Posted by Russel Ray, San Diego Business & Marketing Consultant & Photographer (Russel Ray) over 4 years ago

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