Nuclear liability: Centre asks GIC to work on insurance plan for reactors
To sort out the liability issue plaguing Indian nuclear reactors, the Centre has asked General Insurance Company (GIC) to work on a model that could be applied to insure such facilities in the country.
New Delhi: To sort out the liability issue plaguing Indian nuclear reactors, the Centre has asked General Insurance Company (GIC) to work on a model that could be applied to insure such facilities in the country.
"This is preliminary work. We have asked GIC to prepare a product that can be used for the nuclear industry," said a senior government official.
Government sources said that the decision in the above regard was taken at a meeting between the Ministry of Finance and Department of Atomic Energy earlier this month.
The proposed (insurance) product would have to look into the capacity of a reactor and the liability and then work out the premium for insuring it.
"The work is in progress. We are interacting with the Indian industry as well as Indian insurance companies. I am sure there will a good solution available," said DAE secretary Ratan Kumar Sinha.
A senior government official said that "the problem is how does one circumvent the Right to Recourse".
Under the Civil Liability for Nuclear Damage Act, 2010, the operator, which is the Nuclear Power Corporation of India Ltd (NPCIL), has to pay Rs 1,500 crore to affected parties in case of an accident.
However, it can invoke the 'Right to Recourse', which has been objected to by several international players and domestic suppliers. Under this, NPCIL can seek damages from the suppliers.
"This means liability can be fixed on the suppliers. But a nuclear reactor may have several components from different suppliers. In case of an accident in one part, the supplier of another component cannot be held responsible.
"This has been one of the major grouses of suppliers. GIC has also been asked to look into this," the official said.
The official added that it also needs to be seen how much can GIC insure because the cost of insurance is exorbitant and the company may need the government's or other companies' support for it.
With suppliers raising concerns over certain aspects of the Nuclear Liability Act, DAE has decided to look into these worries to weed out "unnecessary liability".
Last year, DAE formed two committees to find out a middle path on the controversial issue keeping in view the concerns of foreign firms and the Indian Atomic Industrial Forum (IAIF), of which NPCIL and companies that manufacture components for nuclear power plants are a part.