SECTION 252:515-27-80. Insurance

(a)   Insurance authorized. Financial assurance for closure and/or post-closure care may be satisfied by obtaining insurance that conforms to the requirements of this Section.

(b)   Definition. When used in this Section, the term "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.

(c)   Acceptable insurers. At a minimum, the insurer must be licensed to transact the business of insurance in the State of Oklahoma, or be eligible to provide insurance as an excess or surplus lines insurer, in one or more States.

(d)   Submit to the DEQ. A copy of the insurance policy must be submitted to the DEQ for approval, and a copy of the approved policy placed in the operating record.

(e)   Policy requirements. The insurance policy must include the following provisions.

(1)   Face amount. The policy must be issued for a face amount at least equal to the current cost estimate for closure or post-closure care, whichever is applicable, except as provided in OAC 252:515-27-72 (relating to the use of multiple mechanisms).

(2)   Funds available. The policy must guarantee that funds will be available to close the facility whenever final closure occurs or to provide post-closure care for the facility whenever the post-closure care period begins, whichever is applicable.

(3)   Insurer responsible. The policy must guarantee that once closure or post-closure care begins, the insurer will be responsible for the paying out of funds to the owner/operator or other person authorized to conduct closure or post-closure care, up to an amount equal to the face amount of the policy.

(4)   Assignment of policy. The policy must contain a provision allowing assignment of the policy to a successor owner/operator. Such assignment may be conditional upon consent of the insurer, provided that such consent is not unreasonably refused.

(5)   Insurer may not cancel, terminate, or fail to renew. The policy must include a provision that the insurer may not cancel, terminate or fail to renew the policy except for failure to pay the premium.

(6)   Automatic renewal. The policy must provide the insured with the option of automatic renewal of the policy at the face amount of the expiring policy.

(f)   Reimbursements authorized. Persons authorized to conduct closure or post-closure care may receive reimbursements from the insurer for closure or post-closure expenditures, whichever is applicable.

(1)   Sufficient value. The remaining value of the policy must be sufficient to cover the remaining costs of closure or post-closure care.

(2)   Justification. Justification for the reimbursement must be submitted to the DEQ for approval.

(3)   Place in operating record. A copy of the approval and supporting documentation must be placed in the operating record.

(4)   Document reimbursement received. Documentation shall be provided to the DEQ to demonstrate reimbursement has been received.

(g)   Cancellation for non-payment. If there is a failure to pay the premium, the insurer may cancel the policy by sending notice of cancellation by certified mail to the owner/operator and to the DEQ at least 120 days in advance of cancellation.

(h)   New financial assurance required. DEQ approved alternate financial assurance meeting the requirements of this Part must be established:

(1)   prior to cancellation of the policy by the insurer; or

(2)   within 60 days of receipt of notice the insurer no longer meets the requirements of (c) of this Section.

(i)   Annual increases for policies for post-closure care.

(1)   For insurance policies providing coverage for post-closure care, commencing on the date that liability to make payments pursuant to the policy accrues, the insurer must thereafter annually increase the face amount of the policy.

(2)   Such increase must be equivalent to the face amount of the policy, less any payments made, multiplied by an amount equivalent to 85 percent of the most recent investment rate or of the equivalent coupon-issue yield announced by the U.S. Treasury for 26-week Treasury securities.

[Source: Added at 20 Ok Reg 1151, eff 6-1-03]