Resident loses home insurance due to presence of gas well

Social, legal and health issues related to air and water toxic pollution in Australia.

Resident loses home insurance due to presence of gas well

Postby HVPA_research » Sat Aug 10, 2013 8:18 am

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This nasty development comes from the USA where people sometime own mineral rights under the land they own. This is not the case in Australia but when it comes to unconventional gas, Americans lead the way. Whatever happens there sooner or later happens here. We have currently a state-wide study into CSG and property prices so this may be relevant
CSG impact of Hunter property prices
HUNTER property prices will be scrutinised as part of a statewide study into how coal seam gas projects are affecting their neighbours' land values.

The NSW Valuer General has announced a study into how coal seam gas projects have struck land values, using sale prices to determine whether the industry is having a "material impact" on surrounding land.

Lebanon resident loses homeowner's insurance due to presence of gas well
----- Original Message -----
Sent: Friday, August 09, 2013 2:44 PM
Subject: Lebanon resident loses homeowner's insurance due to presence of gas well

Dear Concerned Madison County residents on natural gas issues:

I wanted to share with you a new discovery that we have been receiving warning signs about for several years that could have severe implications for Lebanon property owners and farmers.

I have reached out on behalf of a constituent who had their homeowner's insurance renewal for their home and farm in Lebanon denied because there is a gas well on their property.

I confirmed through the insurance agent, who writes a lot of policies in southern Madison County, that this is a new trend and will come up as property owners fill out renewal applications.
The property owner reports no history of payment problems or incidents on the property - the gas royalties go to the previous owner but the property owner holds the lease and royalty rights for future wells.

This seems so far to be limited to property owners who have gas wells, and does not so far seem to extend to gas leases or those who were compulsorily integrated but have no gas well on their property, but we will have to see how this develops. Initially, we thought it was limited to one company but it turns out it is a trend, and given how many property owners in Lebanon have gas wells on their property, some dating back to the 1960s, this present a tremendous potential problem as those individuals would not have insurance liabilty coverage and will be exposed, not to mention have great difficulty persuading others to buy their property when they are ready to sell.

The question is going to be how far this will spread as more homeowners and farmers are asked to fill out homeowner insurance renewal applications. This was on a property where the buyers had inherited the gas well and lease from a prior owner and had owned the property for 17 years, and the DEC was not aware of this trend. In my inquiries with state officials so far, there is no high risk pool for homeowners to go into if they cannot get homeowners insurance but I am going to ask our state representatives to find out what options property owners impacted by this will have.

This appears to be directly related to perceived liabilty of having a gas well on one's property, and we are talking about Medina and Herkimer Sandstone formation wells, not the new proposed high volume hydraulic fracturing process.

Given 25 percent of Madison County is leased, and there are about 60 gas wells in the Town of Lebanon the last time I checked, the implications could be significant. There are also several gas wells in Eaton and Hamilton and a number in neighboring Smyrna, Plymouth and other towns in Chenango County.

If this becomes a widespread practice, this will change the discussion significantly in the upstate region about gas drilling and development. I do not yet know if this also applies to natural gas infrastructure like pipelines, gathering systems and other infrastructure. The insurance company that brokers plans for many said that this is a new development in the homeowner insurance business of recent origin and not usual practice.

The homeowners/farmers in question had their current policy run out July 31, 2013 and so far have not had any success finding another company to renew their policy and the agent confirms that the denial is based on the presence of a natural gas well.

In addition, the DEC has confirmed that this property has had a gas well on it without incident for nearly two decades. The DEC has no knowledge of this development.

I am asking Assemblyman Magee of the Agricultural Committee and Senator Valesky of the IDC to step in immediately to see what can be done. This could have significant and profound implications for property owners and municipal governments where gas wells currently exist or are anticipated.

Jim Goldstein, Lebanon Supervisor

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