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does not include an accident by reason only of war or
radio-activity; Sec. 2(a)
2) "Collector" means the Collector having jurisdiction over
the area in which the accident occurs.
3) "Handling", in relation to any hazardous substance,
means the manufacture, processing, treatment,
package, storage, transportation by vehicle, use,
collection, destruction, conversion, offering for sale,
transfer or the like of such hazardous substance;
Sec.2(c).
and where the insurer fails to so remit the further amount, 4) "Hazardous substance" means any substance or
such amount shall be recoverable from insurer as arrears preparation which is defined as hazardous substance
of land revenue or of public demand." under the Environment (Protection) Act, 1986, and
exceeding such quantity as may be specified, by
From the above statutory provisions of Sec. 4 of the PLI Act notification, by the Central Government; Sec.2(d)
1991, we can appreciate that Public Liability Insurance
under Public Liability Insurance Act, 1991 is a creation From the above definitions and discussions, it is clearly
rather than requirement of law. Taking proper public established that Public Liability Act Insurance is governed
liability insurance cover is not a choice, rather obligation of by law i.e. PLI Act 1991 defining and providing all terms,
an owner of hazardous goods or chemicals as specified by conditions, limits, exclusions and explanations required for
the Act. underwriting this insurance policy. The legal aspects as
Sec.2 (g) of the Act defines the word "owner" mentioned defined and explained by the Act are important
above in the following terms; consideration for its underwriting and claims management.
Owner means a person who owns, or has control over Precisely all firms/individuals owing/dealing with hazardous
handling any hazardous substance at the time of accident goods are required to take this policy satisfying the limits
and includes,- specified in the Act. The policy covers Legal liability of the
i) in the case of firm, any of its partners; insured towards damages of the third party in respect of
death /injury /diseases & property damages due to accident
ii) in the case of an association, any of its members; and up to the specified insurance Limits called AOA (Any One
Accident) and AOY (Any One Year). AOA will be equal to
iii) in the case or a company, any of its directors, Paid up Capital and AOY is 3 times of AOA & Max Rs.50cr.
managers, secretaries or other officers who is directly
in charge of, and is responsible to the company for the Underwriting Considerations
conduct of the business of the company.
1. Liability to give relief on principle of "NO
For proper administration of Public Liability Act Insurance FAULT" (Sec.3);
Policy, the PLI Act 1991 has also defined certain important
aspects used for insurance on the following terms; (1) Where death or injury to any person (other than a
workman) or damage to any property has resulted from an
1) "Accident" means an accident involving a fortuitous, accident, the owner shall be liable to give such relief as is
sudden or unintentional occurrence while handling any specified in Schedule for such death, injury or damage.
hazardous substance resulting in continuous,
intermittent or repeated exposure to death, of or (2) In any claim for relief under sub-section (I) (hereinafter
injury to, any person or damage to any property but referred to in this Act as claim for relief), the claimant shall
not be required to plead and establish that the death, injury
The Insurance Times, February 2016 25
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