Is there a type of insurance that covers this?

dodge guy wrote:
I think I'de be more upset about a $750 bill to drain out the bad gas!!!

It's nothing more than draining the tank and a new filter.

You might want to think that through a bit farther. For example, what does the shop do with 30 gallons of hazardous waste? Because that's what it is. They can't sell it. They can't use it. They can't even give it away. They have to pay someone to haul it away and dispose of it properly. And as the OP mentions later, there were other repairs involved.