Texas Administrative Code › Title 30 - ENVIRONMENTAL QUALITY › Part 1 - TEXAS COMMISSION ON ENVIRONMENTAL QUALITY › Chapter 37 - FINANCIAL ASSURANCE › Subchapter C - FINANCIAL ASSURANCE MECHANISMS FOR CLOSURE, POST CLOSURE, AND CORRECTIVE ACTION › Section 37.241 - Insurance

Current through Reg. 49, No. 28; July 12, 2024
(a) An owner or operator may satisfy the
				  requirements of financial assurance by obtaining insurance which conforms to
				  the requirements of this section, in addition to the requirements specified in
				  Subchapters A and B of this chapter (relating to General Financial Assurance
				  Requirements and Financial Assurance Requirements for Closure, Post Closure,
				  and Corrective Action), and submitting an originally signed certificate to the
				  executive director.
(b) 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 or
				  more states.
(c) The wording of the
				  certificate of insurance must be identical to the wording specified in §
										37.341
				  of this title (relating to Certificate of Insurance).
(d) The insurance policy must be issued for a
				  face amount at least equal to the current cost estimate for closure, post
				  closure, or corrective action, except when a combination of mechanisms are used
				  in accordance with §
										37.41
				  of this title (relating to Use of Multiple Financial Assurance Mechanisms) or
				  §
										37.52
				  of this title (relating to Use of a Universal Financial Assurance Mechanism for
				  Multiple Facilities and Program Areas). Actual payments by the insurer shall
				  not change the face amount, although the insurer's future liability shall be
				  lowered by the amount of the payments.
(e) The insurance policy must guarantee that
				  funds shall be available to provide for closure, post closure, or corrective
				  action of the facility. The policy shall also guarantee that once closure, post
				  closure, or corrective action begins, the issuer shall be responsible for
				  paying out funds, up to an amount equal to the face amount of the policy, upon
				  the direction of the executive director, to such party or parties as the
				  executive director specifies.
(f)
				  An owner or operator or any other person authorized to perform closure, post
				  closure, or corrective action may request reimbursement for closure, post
				  closure, or corrective action expenditures by submitting itemized bills to the
				  executive director. The request shall include an explanation of the expenses
				  and all applicable itemized bills. The owner or operator may request
				  reimbursement 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 60 days after receiving bills for closure,
				  post closure, or corrective action activities, the executive director shall
				  determine whether the closure, post closure, or corrective action expenditures
				  are in accordance with the approved closure, post closure, or corrective action
				  activities or are otherwise justified, and if so, shall instruct the insurer to
				  make reimbursement in such amounts as the executive director specifies in
				  writing. If the executive director has reason to believe that the maximum cost
				  of closure, post closure, or corrective action over the remaining life of the
				  facility will be greater than the face amount of the policy, the executive
				  director may withhold reimbursement of such amounts as deemed prudent until the
				  executive director determines, in accordance with Subchapters A and B of this
				  chapter, that the owner or operator is no longer required to maintain financial
				  assurance requirements for closure, post closure, or corrective action of the
				  facility. If the executive director does not instruct the insurer to make such
				  reimbursements, the executive director shall provide the owner or operator with
				  a detailed written statement of reasons.
(g) The owner or operator must maintain the
				  policy in full force and effect until the executive director consents to
				  termination of the policy. Failure to pay the premium, without substitution of
				  alternate financial assurance as specified in this subchapter, shall constitute
				  a violation of these regulations, warranting such remedy as the executive
				  director deems necessary. Such violation shall be deemed to begin upon receipt
				  by the executive director of a notice of future cancellation, termination, or
				  failure to renew due to nonpayment of the premium, rather than upon the date of
				  expiration of the policy.
(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 shall, 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
				  executive director. Cancellation, termination, or failure to renew may not
				  occur, however, during 120 days beginning with the date of receipt of the
				  notice by both the executive director and the owner or operator, as evidenced
				  by the return receipts.
(i)
				  Cancellation, termination, or failure to renew may not occur and the policy
				  shall remain in full force and effect in the event that on or before the date
				  of expiration:
(1) the executive director
				  deems the facility abandoned; or
(2) the permit expires, is terminated, is
				  revoked, or a new or renewal permit is denied; or
(3) closure is ordered by the executive
				  director of the commission or by a United States district court or other court
				  of competent jurisdiction; or
(4)
				  the owner or operator is named as debtor in a voluntary or involuntary
				  proceeding under Title 11 (Bankruptcy), United States Code; or
(5) the premium due is paid.