New India Assurance & 3 other insurers gear up to pay claims to LG Polymers gas hit victims

All the the four general insurers have provided an annual cover- a Rs five crore in case of a single incident and Rs 15 crore in case of multiple incidents in a year- to the plant under the Public Liability Insurance Act 1991(PLI Act1991),that  provides for damages to victims of an accident which occurs as a result of handling any hazardous substance. It covers costs for personal injuries, loss or damage to property, and death

 

Mumbai:

State owned New India Assurance(NIA),along with  private sector major HDFC General Insurance,Future Generali General Insurance and Magma HDI General Insurance Company as co- insurer have insured the LG Polymers plant in Vizag,which has been hit by a pre-dawn chemical gas leakage on Thursday,killing 11 people and affecting more than 1000 local inhabitants.Other general insurers like are minor co-insurers of the plant. 

 

NIA has received 76 per cent of the premium and rest 24 per cent has been equally divided among other three insurers.

 

All these general insurers have provided an annual cover- a Rs five crore in case of a single incident and Rs 15 crore in case of multiple incidents in a year- to the plant under the Public Liability Insurance Act 1991(PLI Act1991),that  provides for damages to victims of an accident which occurs as a result of handling any hazardous substance. It covers costs for personal injuries, loss or damage to property, and death.

 

The old Act,enacted almost 30 years ago, provides merely Rs 25,000 of compensation in case of deaths and Rs 12,500 to the injured out of any accident.

 

``In total the insurers' liability wouldn't exceed beyond Rs 2.5 crore,'' said industry analasts.  

 

However,claims from the victims of the gas laek disaster are yet to start pouring in, said the NIA sources.
 

The PLI Act 91 applies to all owners associated with the production or handling of any hazardous chemicals. . The Act gives relief on the principle of “No Fault”.No fault liability means liability of a person even without any negligent act on his part and even if he has taken due care and caution. Also  If a person brings and keeps any dangerous thing on his land, then he is liable for any damage caused if the thing escapes.


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