The automatic safe shutdown of the 220MW pressurised heavy water reactor (PHWR) at Kakrapar Atomic Power Station (KAPS) following heavy water leak on March 11 actually strengthens the operator NPCIL's position for a public liability insurance policy, said a senior official.
"The plant was automatically shut down after the heavy water leak. The public was not affected due to any radiation, " the Nuclear Power Corporation of India Ltd's (NPCIL) official, who did not want to be identified, told IANS.
According to him, all the NPCIL plants including KAPS are insured and an insurance claim will be lodged after ascertaining the actual cause of leak and the damage.
However, the much - awaited public liability policy is yet to be issued to the atomic power plant operator.
"The public liability insurance policy has not yet been issued. The General Insurance Corporation of India (GIC Re) is dealing with the matter, " said the NPCIL official.
Despite several attempts by IANS, GIC chairman - cum - managing director Alice G. Vaidyan was not available for comments.
"The insurers have designed the policy and the IRDAI (Insurance Regulatory and Development Authority of India) has also approved this. However, NPCIL wants some conditions to be changed and the matter is under discussion, " New India Insurance Company Ltd chairman - cum - managing director G. Srinivasan had told IANS some time back.
Sources in the know told IANS that for a premium of around Rs. 70 crore ($10. 5 million), a consortium of insurers would provide cover up to Rs. 1, 500 crore per incident and per year.
The proposed 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.
"It's like a floater cover (insurance cover will be for all of NPCIL's plants). When a nuclear accident happens and the Rs. 1, 500 crore cover is exhausted, then there will not be any insurance cover for subsequent accidents that might occur during that policy year, " an industry source told IANS.
While NPCIL wants the risk cover to be reinstated at the same cost, the insurers are reluctant as this would wipe out their balance sheet.
"Insurers do not want to take another risk cover of Rs. 1, 500 crore for a paltry sum of around Rs. 70 crore, " an industry expert had said earlier.
He said reinsurers want higher deductibles and NPCIL to bear claims up to the first Rs. 600 crore.
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 GIC Re, four government - owned general insurers and also some private general insurers, have provided the capacity to insure the risks of up to around 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 (CLND) 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.
All the 21 operating nuclear power plants in India owned and operated by NPCIL are expected to come under the public liability insurance cover, which will also extend to the 1, 000 MW plant built with Russian equipment at Kudankulam in Tamil Nadu.
Insurers would like to issue a single policy covering all the 21 units. The premium will be paid by NPCIL and the policy will be issued in its name.
(Venkatachari Jagannathan can be contacted at v. jagannathan@ians. in)