Part of a Trio of Consumer Protection Initiatives Recently Passed by the Senate
On April 26, 2024, the Massachusetts Senate passed a new bill on home insurance as part of a Consumer Protection Package. S.2737 entitled An Act Relative to the Remediation of Home Heating Oil Releases. The bill, part of a trio of measures aimed at enhancing consumer protections in the Commonwealth, was initially filed by Sen. Anne Gobi, D-Spencer, who is now Governor Healey’s Director of Rural Affairs.
What the Current Law Requires of Insurers
Since 2010, Massachusetts law mandates that insurers offer coverage for leak from oil heat systems. It does not, however, require that it be included automatically as a part of its standard homeowner’s insurance policy.
As the Mass.gov website explains to consumers, the current state law says that companies “shall make coverage available” for owners. So, while coverage is available, there are many documented cases of companies not making owners aware that the provision is available. This often results in homeowners being unaware they do not have insurance coverage until after they experience a liquid fuel tank leak.
What the New Bill Would Mandate
The new bill would resolve this issue by requiring insurers to include coverage for home heating oil spills and releases. In an update from Senate President Karen Spilka’s office, the Senate President says the measure is needed to help the approximately 100 homeowners in Massachusetts who experience an oil leak in the Commonwealth each year.
According to the MassDEP, consumers affected by an oil leak can incur costly damage not only to their own residence but also the surrounding area as owners are responsible for the environment clean-up stemming from an oil spill under Massachusetts law. As such, costs incurred for this type of a clean-up can often reach or exceed $100,000 for consumers who need to clean-up and dispose of contaminated soil in addition to mitigating the spread in surrounding areas.
As a result, the Senate Bill proposes the following language, which if signed into law would take effect on policies issued or renewed on or after July 1, 2025.
Statements from Legislators on Passage of Senate Bill
“Today we are sending a clear message to consumers around the Commonwealth that the Massachusetts Senate has your back,” said Senate President Karen E. Spilka (D-Ashland). “These legislative measures are more than just consumer protection provisions—they are important to support equity and our residents’ physical and financial safety. I am proud that the Senate took action today to move towards a Commonwealth where we prioritize transparency and safety for all residents. I want to offer my thanks to Attorney General Campbell, Chair Rodrigues, Senator Crighton, and Senator Feeney, and all the Senators and advocates who championed these protections.”
“The Senate has again taken the lead in approving three strong consumer protection measures that will help and improve upon the quality of life for so many residents of the Commonwealth. These bills reinforce and strengthen safeguards that are already in place and affect almost everyone; ensuring that consumers pay a fair rate for electricity, have homeowners’ insurance that actually works, and buy a vehicle in confidence. Thanks to Chairs Feeney and Crighton for their work on this legislation, and Senate President Spilka for her leadership on moving these issues forward,” said Senator Michael J. Rodrigues, (D-Westport) Chair of the Senate Committee on Ways and Means.
“… As the Chair of the Joint Committee on Financial Services, I am also grateful that the Senate has passed a much-needed consumer protection measure to protect homeowners in the event of an accidental home heating oil release so that homeowners aren’t saddled with exorbitantly high clean-up costs through no fault of their own. Together, these new consumer protection measures will allow the Commonwealth to best safeguard the rights of Massachusetts residents, instill confidence in consumers, and allow our state agencies to best advocate on behalf of consumers,” said Senator Paul Feeney (D-Foxborough). “I want to thank the Attorney General and her office for their continued partnership, and to Senate President Spilka and Chairman Michael Rodrigues for their commitment to protecting Massachusetts consumers and residents.”
After the approval by the Senate, the bill now heads over to the House of Representatives for consideration. Upon its passage by both the House and Senate, it would then be sent to Governor Healey’s desk for her to sign it into law.
