India’s first insurance policy covering public liability to an atomic power plant operator has been issued to Nuclear Power Corporation of India Ltd (NPCIL) but the reinstatement of insurance value post a claim will be decided later, industry officials said.
“We recently got the insurance policy covering all our atomic power plants. The total premium came around Rs 100 crore for a risk cover of Rs 1,500 crore,” S. K. Sharma, Chairman and Managing Director, NPCIL, told IANS.
The policy complies with all the provisions of the Civil Liability for Nuclear Damage Act (CLND), said a known insurance industry official.
The central government had announced in June 2015 the setting up of the Rs 1,500 crore India Nuclear Insurance Pool to be managed by national reinsurer GIC Re.
The insurance policy on behalf of clutch to non-life insurers was issued by the country’s largest non-life insurer New India Assurance Company Ltd.
The policy would cover the liability towards public as a consequence of any nuclear accident in the plants covered under the policy and also the right of recourse of NPCIL against equipment suppliers.
The insurance coverage will be for all the NPCIL’s plants -- like a floater cover.
Queried about the reinstatement premium the official said it would be decided post a claim based on the capacity -- to underwrite the risk-available with the insurers.
Reinstatment clause in an insurance policy enables a policyholder to extend the insurance cover to the original limit on payment of premium post a claim.
The insurance official also said the policy does not have any ‘policy excess’ -- part of the claim a policyholder has to bear himself.
The GIC Re, four government-owned general insurers and also some private general insurers have provided the capacity to insure the risks of up to Rs 1,000 crore with the balance Rs 500 crore being obtained from the British Nuclear Insurance Pool.
The losses or profits in the pool would be shared by the insurers in the ratio of their agreed risk capacity.
Foreign nuclear plant suppliers were reluctant to sell to India, citing the provisions of the Civil Liability for Nuclear Damage Act 2010 that provides the right of recourse by NPCIL against the vendors under certain circumstances for compensation in case of an accident.
The insurance pool was formed as a risk transfer mode for the suppliers and also NPCIL.