India's atomic power company, Nuclear Power Corporation of India Ltd (NPCIL) is confident of getting the public liability insurance policy in 10 - 15 days time, said a senior official.
Once the policy is received, then the company can go ahead in full steam to start its project in Haryana, said the official, speaking to IANS on the condition of anonymity.
"The negotiations as to the risk coverage conditions with the insurers are over and issues have been sorted out. We are confident of getting the policy in 10 - 15 days time, " the official said.
He categorically said the policy would be on reinstatement basis - that is the coverage will be reinstated to the original level on payment of same premium after a claimable nuclear accident.
While the official declined to comment on the premium to be paid to get the policy to cover public liability up to Rs. 1, 500 crore per year, per accident industry sources had earlier told IANS that it will be around Rs. 70 crore.
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.
The insurance coverage will be for all the NPCIL's plants - like a floater cover.
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.
According to the NPCIL official if such a situation occurs, then the policy coverage will get automatically reinstated to Rs. 1, 500 crore on payment of premium.
"The policy complies with all the provisions of the Civil Liability for Nuclear Damage Act (CLND) giving the necessary comfort to the suppliers, " he said, adding that the premium will be paid to the insurers soon as the terms and conditions have now been finalised.
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.
According to the senior NPCIL official, equipment suppliers were concerned about the availability of the policy - as they can also be asked to pay the damages to the public - when the company approached them for supplies for the Haryana project, where the NPCIL is planning to set up two 700 MW units first and later add two more units of similar size there.
According to NPCIL official, insurers do not provide insurance cover for the equipments in the "hot zone" or the reactor zone.
Insurance Regulatory and Development Authority of India (IRDAI) former member K. K. Srinivasan told IANS that this was because Indian insurance companies have not had the chance to acquire any significant expertise or capacity for covering property risks in the 'hot zone' of nuclear power plants.
"Beyond the hot zone, the process of generating power using steam to run the turbines is not significantly different from the process followed in thermal power plants. Thus, insurers in India do have the ability and capacity to assess and underwrite risks outside the hot zone, " he added.
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