Section 329IAC3.1-14-8. Closure insurance option

   (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 closure insurance that conforms to the requirements of this section and submitting a certificate of such insurance to the commissioner. The owner or operator shall submit the certificate of insurance to the commissioner or establish other financial assurance as specified in sections 5 through 7 of this rule, this section, and section 9 of this rule. At a minimum, the insurer shall 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 closure insurance policy must be issued for a face amount at least equal to the current 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 closure insurance policy must guarantee that funds will be available to close the facility whenever final closure occurs. The policy also must guarantee that once final closure begins, the insurer shall be responsible for paying out funds up to an amount equal to the face amount of the policy, upon the direction of the commissioner, to such party or parties as the commissioner specifies.

  (e) After beginning partial or final closure, an owner or operator or any other person authorized to conduct closure may request reimbursements for 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 closure activities, the commissioner shall instruct the insurer to make reimbursements in such amounts as the commissioner specifies in writing if the commissioner determines that the partial or final closure expenditures are in accordance with the approved closure plan or otherwise justified. If the commissioner has reason to believe that the maximum cost of 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 such amounts as 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 final closure of the particular facility. If the commissioner does not instruct the insurer to make such 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 as specified in subsection (j). Failure to pay the premium, without substitution of alternate financial assurance as specified in sections 5 through 7 of this rule, this section, and section 9 of this rule, constitutes a major violation of this rule warranting such remedy as the commissioner deems necessary and is authorized to make. Such 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. Such assignment may be conditional upon consent of the insurer provided such 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, however, 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) closure is ordered by the commissioner, the Environmental Protection Agency (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., October 1, 1979; or

(5) the premium due is paid.

  (i) Whenever the current 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 closure cost estimate and submit evidence of such increase to the commissioner; or

(2) obtain other financial assurance as specified in sections 4 through 7 of this rule, this section, and sections 9 through 11 of this rule to cover the increase.

Whenever the current closure cost estimate decreases, the face amount may be reduced to the amount of the current 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 as specified in 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.

(Solid Waste Management Division; 329 IAC 3.1-14-8; filed Jan 24, 1992, 2:00 p.m.: 15 IR 951; filed Apr 1, 1996, 11:00 a.m.: 19 IR 1976; readopted filed Jan 10, 2001, 3:25 p.m.: 24 IR 1535)