Government was expected to bridge the gap as foreign cos were not insuring nuclear installations that were not open to inspections.
The UK-based insurer Marsh has come to the rescue of domestic reinsurance company GIC Re to launch India's first nuclear pool. Marsh, a global leader in insurance broking and risk management and a member of the UK pool, Nuclear Risk Insurer (NRI) that is commonly called British nuclear pool, is contributing Rs 600 crore despite India not throwing open its nuclear installation for inspections by foreigners.
The Indian Nuclear Insurance Pool (INIP), a pooling arrangement to address exposures of nuclear operators and suppliers, will have a corpus of Rs 1,500 crore, and is being set up with the support of 11 domestic insurance companies.
The Indian nuclear pool will be the 27th such pool in the world. It is expected to address third-party liability insurance to begin with and later expand into property and other hot zone (inside reactor areas) risk. This will cover both operators and suppliers. At present, only cold zones (outside reactor areas) are being covered.
Earlier, it was widely expected that the government would bridge the shortfall.
Ashok Kumar Roy, chairman, GIC Re, said, "There were a lot of difficulties in creating the pool but I was certain it would happen." Though the premium and the sum insured is still on the drawing board, nuclear insurance will be like a floater policy, the cover of which could float between various nuclear power stations and it will be managed by GIC Re.
Indian insurance companies were planning to form a pool as early as 2013. In 2010, Parliament passed the Civil Liability Nuclear Disaster (CLND) Act, which created a liability cap for nuclear plant operators for economic damage in the event of an accident.
Foreign insurance companies were not insuring Indian nuclear installations as they were not open to inspections. Mark Popplewell, managing director of NRI, said, "We facilitated Marsh to extend support to the Indian nuclear pool." Mark Pollard, managing director of Marsh, said he is happy to extend support to the Indian nuclear pool.
Nuclear power is the fourth largest source of electricity in India after thermal, hydroelectric and renewable sources of electricity. All the existing 26 nuclear plants would be covered by one master policy, according to GIC Re.
Domestic insurance companies who joined hands include New India Assurance, United India, SBI General, Oriental Insurance, Tata AIG, Chola MS General Insurance, Universal Sompo, IFFCO-Tokio General Insurance, Reliance General Insurance, National Insurance Company and Oriental Insurance.
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