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PUBLIC LIABILITY ACT POLICY

 

Public Liability Act 1991

  • The Public Liability Act 1991 is
  • “An act to provide for public liability insurance for the purpose of providing immediate relief to persons affected by accident occurring while handling any hazardous substance and for matters connected therewith or incidental thereto”

Public Liability Act- reason

  • The explanation says that” the growth of hazardous industries, processes and operations in India has been accompanied with by the growing risks from accidents to the innocent victims. Very often, the majority of people affected are from weaker sections of the society. It is therefore felt necessary to provide for mandatory public liability insurance for installations handling hazardous substances to provide minimum relief on the principle of “NO FAULT LIABILITY”
  • This Act makes it mandatory for Owners involved in handling hazardous goods to take insurance policies for an amount not less than the amount of paid-up capital of the undertaking handling hazardous substance and owned/ handled by the owner. These policies have to be renewed till the period during which hazardous substance are handled.
  • This Act makes it mandatory for Owners involved in handling hazardous goods to take insurance policies for an amount not less than the amount of paid-up capital of the undertaking handling hazardous substance and owned/ handled by the owner. These policies have to be renewed till the period during which hazardous substance are handled.

Compensation

  • The Minimum compensation under the act is as follows
  • The limits of compensation payable are defined in the Act As Rs. 12,500 Maximum for Medical expenses per person
  • Rs. 25,000 Maximum for Fatal accident in addition to medical expenses
  • Rs. 25,500/- for permanent total or permanent partial or other injury or sickness
  • Rs. 1000 per month upto maximum of 3 months for loss of wages due to temporary partial disability provided the victim has been hospitalized for a period exceeding 3 days and is above 16 yrs of age 
  • Upto Rs. 6000 depending upon actual damage for damage to third party property.

Limits of Insurance

  • Insurance Limits- Rule 10 provides
  • AOA – Minimum of Paid up Capital & Maximum Rs 5 crore 
  • AOY – Max 3 times of AOA i.e Max up to Rs 15 crore
  • In addition to the premium insurer has to pay an equivalent amount to be credited to the Environment Relief fund established under the act.
  • Transportation is inbuilt unlike Market agreement Policies

General Exclusions

  • 1. Willful or intentional non compliance of statutory provisions
  • 2. War and allied Perils
  • 3. Nuclear risks

Additional premium for ERF

  • Payment of equal premium for Environment Relief fund:-
  • A premium equal to the amount of premium under the policy is to be paid for Environment Relief Fund. This fund will be utilized for providing relief which exceeds the amount payable under the insurance policy.

For any insurance solutions, please contact Beacon Insurance at https://www.beacon.co.in/ 

Insurance is a subject matter of solicitation

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