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Hazardous Objects Insurance

On January 1, 2012 the main provisions of Federal Law #225-FZ dated July 27, 2010 “On Compulsory Liability Insurance of an Owner of a Hazardous Facility against Damage resulting from an Accident at a Hazardous Facility” (the Law) came into force. 

The Law concerns the compulsory requirement for legal entities or entrepreneurs who own or operate hazardous facilities in Russia to insure against damage resulting from any accident at those facilities. 

Under the Law injured persons include both third parties and employees. The Law extends to the following types of hazardous facilities:

1) Plants (enterprises) or their workshops, territories or fixed facilities where:

  • hazardous agents (inflammable, oxidizing, ignitable, toxic, explosive, highly toxic and potentially dangerous to the environment) are made, used, processed, formed, transported or destroyed
  • equipment is operated under a pressure exceeding 0,07 MPa or water temperature exceeding 115°C 
  • stationary freight lifting mechanisms, escalators (including lifts and escalators in residential buildings, shopping centers, restaurants and administrative buildings), cableways and funiculars are used 
  • metals / non-ferrous metals are melted and alloys used 
  • mountain, mineral processing and underground works are carried out

2) Hydraulic Facilities: 
Dams, power plants, water outlets, water discharge facilities, tunnels, canals, pump stations, navigation locks, shipping locks,  facilities designated to protect against the flooding and destruction of ponds and river banks, facilities enclosing stores of liquefied industrial or agricultural waste, facilities protecting against washout on canals and other facilities designated for usage of water resources and protection against negative impact of waters and liquefied wastes.

3) Refueling stations (liquid motor fuel). 
As from January 1, 2013 the Law covers state or municipally owned hazardous facilities, hazardous facilities the operation of which is partially or fully financed in accordance with state budgets, and lifts and escalators in residential multi-storeyed apartments. 

The main differences between Federal Law #116-FZ dated 21.07.1997 “On Industrial Security of High Hazardous Facilities” and the new scheme are as follows:

  • The sums insured (limits of liability) have been increased (minimum – 10 million rubles; maximum – 6.5 billion rubles) 
  • The indemnity payment per injured is sub-limited (2 million rubles) 
  • The term “injured” includes third parties as well as employees of the Insured 
  • Damage resulting from the violation of living conditions is covered 
  • Pollution (environmental damage) is not covered 
  • The term “accident” (the event that triggers the policy) is interpreted broadly  
  • The wording and rates are approved by the Government of the Russian Federation and are equal for all insurers
  • The Law stipulates fines of 15 000 to 20 000 rubles for company officers and managers and 300 000 to 500 000 rubles for legal entities for operating  a hazardous facility without compulsory liability insurance,

AIG, JSC is a member of the National Union of Liability Insurers. On December 22, 2011 AIG, JSC was granted a license for the provision of compulsory liability insurance to owners of hazardous facilities. 

AIG is a world leader in liability insurance with over 90 years’ experience in the insurance industry. AIG, JSC has an Expert-RA rating of “A+” (very high level). 

Our underwriters are ready to consult on and assist in concluding compulsory liability insurance contracts under the new Law. 

For more information or to apply for a policy, email opo@aig.com or telephone Yuri Markin on +7 (495) 935 8950

Lost Policies of Compulsory Liability Insurance of Owners of Hazardous Facilities

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