ERP - Environmental Risk Professionals

Storage Tanks

Aboveground and underground storage tanks at cardlock stations may store petroleum products and automotive fluids, including unleaded gasoline, clear and red diesel fuel, and diesel exhaust fuel (DEF). Improper management and monitoring of aboveground and underground storage tanks and associated equipment can lead to spills and releases. Spills can also occur during the loading or unloading of materials. Underground storage tanks, dispensers, sumps, piping, and other components may leak over time or fail. Aboveground storage tanks have the potential to experience leaks from tank bottoms or ruptures. Damage, cracks, or overflow of secondary containment or inadequate secondary containment can allow leaked contents to leach into the underlying soils and groundwater. Released contaminants may contaminate soil or groundwater, enter drywells or storm drains, migrate to neighboring properties, or degrade natural resources.

Fire Hazards

Some products at cardlock stations are flammable and may result in a fire that spreads throughout the facility, releasing potentially hazardous toxins into the air. A fire could also emit toxic fumes and smoke from the burning materials at the property or due to a mix of materials due to the fire. Firefighting solutions such as water and foam could create contaminated run-off that spreads to nearby storm drains or other properties, resulting in environmental cleanup and tort liability.

Vapors

Vapor recovery systems at cardlock stations are designed to capture up to 95% of the vapors and recycle them into fuel storage tanks. However, some vapors are emitted into the atmosphere from fuel dispensing and other sources. The release of vapors into the atmosphere from petroleum products, cleaning products, and idling vehicles can contribute to air pollution.

Diesel

Cardlock stations store more diesel fuel on-site than regular gas stations, as it is the most common fuel used for commercial vehicles. Diesel is flammable, and high quantities of diesel in one location can lead to a large fire event on-site. Though diesel does not ignite as easily as gasoline, it burns at a higher temperature for a longer time, leading to increased resources needed to extinguish, and therefore, can result in tort liability and more expensive environmental cleanup.

Vandalism

Vandals may damage or destroy fuel dispensers, nozzles, or other equipment, temporarily putting the cardlock operation out of service. This may include breaking pump screens, tampering with fuel controls, or attempting to steal fuel. Damaged pumps require costly repairs and cause downtime, potentially leading to a loss of revenue. Fuel spills could migrate to soil, groundwater, or surface waters, resulting in costly cleanup. Additionally, if hazardous components are exposed, environmental contamination or safety hazards, such as fire or explosion risks, could result.

Contractors Pollution Liability Can Provide Coverage For

On-site cleanup of new and pre-existing pollution conditions

Off-site cleanup of new and pre-existing pollution conditions

Third-party claims for cleanup costs

Third-party claims for bodily injury and property damage

Both sudden and gradual pollution conditions

Defense of third-party claims

Civil fines and penalties

Natural resource damage

First-party emergency response cost

Business interruption resulting from pollution conditions

Aboveground and underground storage tanks

First and third-party transportation pollution liability

Loading and unloading

Mold, legionella, bacteria, and fungi

Non-owned disposal sites

Illicit abandonment

Claims Scenarios & Examples

An oily sheen was observed on a local stream. It was traced back to a slow leak from an underground storage tank at a nearby cardlock station. It was determined that the contamination had impacted the stream for several miles, damaging the aquatic species. The station owner was responsible for the stream’s cleanup and natural resource damage.

A release was discovered from a 10,000-gallon diesel aboveground storage tank at a cardlock station. Eight thousand gallons spilled into the secondary containment; however, diesel fuel migrated from the containment area into the underlying soil due to a crack. The contaminated soil investigation, cleanup, and disposal costs surpassed $320,000.

After filling their vehicle with fuel, a cardlock station customer accidentally drove away with the fuel pump nozzle still connected to their truck. As a result, fuel was released onto the ground and migrated to the adjacent property. The cardlock station owner faced cleanup costs for their location and the adjacent property.

A cardlock station owner was performing a routine check of their facility when they noticed gasoline was bubbling up under a concrete pad between fuel dispensers. The owner filed a claim with their insurance company, and an investigation revealed that the underground storage tank system had leaks in several areas. The contamination was widespread, and excavation and remediation of the area had to be conducted. Cleanup costs exceeded their $1 million pollution policy limit, and the station owner faced an additional $100,000 in legal fees connected to regulatory compliance issues.

The insured was the owner of a cardlock station with different types of fuel products. When inventory records indicated a small fuel decrease over time, the owner scheduled a pressure test to determine if the tank system was leaking. The pressure test found that one of the tank’s supply lines was leaking at the connection point. Excavation was completed around the area, and fuel was discovered below the joint in the product line. Control wells were drilled to help stop the spread of contamination, and the polluted soil was excavated and disposed of properly. The insured’s pollution policy paid for the investigation and cleanup, totaling $335,000.

Property Types

Cardlock Stations

Environmental Exposures May Include: