329 IAC 3.1-14-8 - Corrective action or closure insurance option
Authority: IC 13-14-8; IC 13-22-2; IC 13-22-8-1; IC 13-22-9-7
Affected: IC 13-22
Sec. 8.
(a) An owner
or operator may satisfy the requirements of sections 4 through 7 of this rule,
this section, and sections 9 through 11 of this rule by obtaining corrective
action or closure insurance that conforms to the requirements of this section
and submitting a certificate of the insurance to the commissioner. The owner or
operator shall submit the certificate of insurance to the commissioner or
establish other financial assurance in accordance with sections 5 through 7 of
this rule, this section, and section 9 of this rule. At a minimum, the insurer
must be licensed to transact the business of insurance, or eligible to provide
insurance as an excess or surplus lines insurer, in one (1) or more
states.
(b) The wording of the
certificate of insurance must be identical to the wording specified in section
30 of this rule.
(c) The corrective
action or closure insurance policy must be issued for a face amount at least
equal to the current corrective action or closure cost estimate except as
provided in section 10 of this rule. As used in this section, "face amount"
means the total amount the insurer is obligated to pay under the policy. Actual
payments by the insurer will not change the face amount, although the insurer's
future liability will be lowered by the amount of the payments.
(d) The corrective action or closure
insurance policy must guarantee that funds will be available to perform
corrective action or close the facility whenever corrective action or final
closure occurs. The policy must guarantee that once corrective action or final
closure begins, the insurer is responsible for paying out funds up to an amount
equal to the face amount of the policy, upon the direction of the commissioner,
to the party or parties as the commissioner specifies.
(e) After beginning corrective action,
partial closure, or final closure, an owner or operator or any other person
authorized to conduct corrective action or closure may request reimbursements
for corrective action or closure expenditures by submitting itemized bills to
the commissioner. The owner or operator may request reimbursements for partial
closure only if the remaining value of the policy is sufficient to cover the
maximum costs of closing the facility over its remaining operating life. Within
sixty (60) days after receiving bills for corrective action or closure
activities, the commissioner shall instruct the insurer to make reimbursements
in amounts the commissioner specifies in writing if the commissioner determines
that the corrective action, partial closure, or final closure expenditures are
in accordance with the approved corrective action or closure plan or otherwise
justified. If the commissioner has reason to believe that the maximum cost of
corrective action or closure over the remaining life of the facility will be
significantly greater than the face amount of the policy, the commissioner may
withhold reimbursement of amounts the commissioner deems prudent until it is
determined, in accordance with section 12 of this rule, that the owner or
operator is no longer required to maintain financial assurance for corrective
action or final closure of the particular facility. If the commissioner does
not instruct the insurer to make reimbursements, the commissioner shall provide
to the owner or operator a detailed written statement of reasons.
(f) The owner or operator shall maintain the
policy in full force and effect until the commissioner consents to termination
of the policy by the owner or operator in accordance with subsection (j).
Failure to pay the premium, without substitution of alternate financial
assurance in accordance with sections 5 through 7 of this rule, this section,
and section 9 of this rule, constitutes a violation of this rule warranting a
remedy the commissioner deems necessary and is authorized to make. The
violation is deemed to begin upon receipt by the commissioner of a notice of
future cancellation, termination, or failure to renew due to nonpayment of the
premium rather than upon the date of expiration.
(g) Each policy must contain a provision
allowing assignment of the policy to a successor owner or operator. The
assignment may be conditional upon consent of the insurer provided consent is
not unreasonably refused.
(h) The
policy must provide that the insurer may not cancel, terminate, or fail to
renew the policy except for failure to pay the premium. The automatic renewal
of the policy must, at a minimum, provide the insured with the option of
renewal at the face amount of the expiring policy. If there is a failure to pay
the premium, the insurer may elect to cancel, terminate, or fail to renew the
policy by sending notice by certified mail to the owner or operator and the
commissioner. Cancellation, termination, or failure to renew may not occur
during the one hundred twenty (120) days beginning with the date of receipt of
the notice by both the commissioner and the owner or operator as evidenced by
the return receipts. Cancellation, termination, or failure to renew may not
occur and the policy must remain in full force and effect in the event that on
or before the date of expiration:
(1) the
commissioner deems the facility abandoned;
(2) interim status is terminated or
revoked;
(3) corrective action or
closure is ordered by the commissioner, U.S. EPA, or court of competent
jurisdiction;
(4) the owner or
operator is named as debtor in a voluntary or involuntary bankruptcy proceeding
under
11
U.S.C. 101 et seq.; or
(5) the premium due is
paid.
(i) Whenever the
current corrective action or closure cost estimate increases to an amount
greater than the face amount of the policy, the owner or operator, within sixty
(60) days after the increase, shall either:
(1) cause the face amount to be increased to
an amount at least equal to the current corrective action or closure cost
estimate and submit evidence of the increase to the commissioner; or
(2) obtain other financial assurance in
accordance with sections 4 through 7 of this rule, this section, and sections 9
through 11 of this rule to cover the increase.
Whenever the current corrective action or closure cost estimate decreases, the face amount may be reduced to the amount of the current corrective action or closure cost estimate following written approval by the commissioner.
(j)
The commissioner shall give written consent to the owner or operator that the
owner or operator may terminate the insurance policy when:
(1) the owner or operator substitutes
alternate financial assurance in accordance with sections 5 through 7 of this
rule, this section, and section 9 of this rule; or
(2) the commissioner releases the owner or
operator from the requirements of sections 4 through 7 of this rule, this
section, and sections 9 through 11 of this rule in accordance with section 12
of this rule.
Notes
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