In this blogpost, Shivam Anand, Student, DSNLU, Vizag writes about the liability of the insurance company and oil marketing companies in case of LPG accidents, interim reliefs and the procedure to claim the compensation.

INTRODUCTION

Every now and then in the news, we hear of LPG accidents taking away several lives and affecting many. According to a report of Oil Marketing companies comprising Indian Oil, Bharat Petroleum and Hindustan Petroleum, there were more than 140 million LPG users in India in 2010. LPG accident had become rampant and the worst part being that even after the applicability of “Public Liability Insurance Policy” to safeguard the interest of the third party or customers who become a victim of such accidents, many customers are unaware of such Insurance policies. Though the state government declares compensation for the victims, but the question is about the liability of the Oil companies who are the reason behind such accidents and liable to make up for it.

Now under Public Liability Policy (NON-INDUSTRIAL RISK) which is policy no. 0217002715P101332273 there are 3 Oil Marketing Companies insured by UNITED INDIA INSURANCE CO. LTD which are

• M/S.INDIAN OIL CORPORATION LIMITED
• M/S. BHARAT PETROLEUM CORPORATION LIMITED
• M/S. HINDUSTAN PETROLEUM CORPORATION LIMITED

The period of Insurance is renewed every year and the present period of insurance is from 00:00 hrs of 2^nd of May 2015 to the midnight of 1^st of May 2016

Under the policy clause 9.15 it has been provided that no claim shall be payable under this policy until and unless the liability to pay claim is established against the insured in the Indian court.

Under Section 1 of this Public Policy consists legal liability of the insurance company

• With respect to this section, the insurance company will indemnify the insured e., Oil Marketing Companies under this policy against their legal liability to pay compensation including the claimant cost fees and expenses in accordance with Indian law in the case of the accidental bodily injury to any person.
• It also protects in case of accidental damage to property happening during the period of insurance.

Exception:

1. It does not consider the person who is engaged in and upon the service of the insured at the time of occurrence giving rise to such injury and not a person claiming against the insured under any workmen’s compensation act.
2. It does not cover property belonging to or in the custody of the insured or under the control of the insured or any person who has been working for the insured if the damage result directly from such work.

In these exceptional cases the insured company won’t be liable to pay as it happens during the period of employment which is covered under already available compensation act.

SECTION 2

It covers personal accident cover to third party and damage to the registered premises of the authorised customer

• If any person sustains bodily injury solely and directly caused by usage of LPG cylinder during policy period resulting in death or disablement as stated in the prescribed policy document of Insurance company, then the company shall pay to the person or his/her assignee or legal personal representative the sum or sums accordingly as

1. If injury shall within 12 calendar months be direct and sole cause of death of the insured person, then total sum stated in schedule
2. If within 12 month of occurrence of such injury causes total and irrecoverable loss of sight of both eyes or of actual loss by physical separation of 2 entire hands or 2 entire feet or loss of use of hand or one foot then the total sum insured in the schedule

• In the case of total and irrecoverable loss of sight of one eye or of actual loss by physical separation of one entire hand or of one entire foot then 50% of the sum stated in the schedule has to be provided. The same is applicable in the case of total and irrecoverable loss of use of a hand or foot without physical separation in which 50% of the insured sum has to be provided.

1. In case, the injury causes immediate permanently totally and absolutely disable the injured person from engaging in any employment or occupation of any description then a lump sum which is equal to 100% of the sum insured is to be provided.

MEDICAL EXPENSES

The amount of actual medical expenses incurred which shall not exceed Rs. 1,00,000 per person and Rs. 15,00,000 per event including any exceptions.

EXCEPTIONS UNDER WHICH THE INSURANCE COMPANY LIABILITY CEASES:-

• The company is not liable in case the compensation under more than one of provided clauses in respect of the same period of disablement is sought.
• Any other payment after a claim under either of the provided clauses has become payable.
• Payment of compensation in respect of death injury or disablement of the insured person from intentional self-injury or suicide or attempt to suicide or under the influence of liquor/drugs.
• It is also not applicable in case of any breach of the law with criminal intent

LIMIT OF LIABILITY IS

1. 50,00,000 per event
2. and Rs. 10,00,000 per person

CIRCUMSTANCE UNDER WHICH IF ACCIDENT OCCURS THEN LIABLE TO BE COMPENSATED:-

• In the case of filled LPG cylinders was being carried out of the bottling plant.
• In case, the filled LPG cylinders were in transit in the hands of approved transporters.
• In the case of LPG cylinders stored in the distributors
• In a case filled LPG cylinder was in transit from distributors premises to registered customer’s premises.
• In a case filled LPG cylinders was lying in registered customer’s premises.
• In case, empty or filled cylinders are being carried back to bottling plants.
• In the case of arising out of the use of LPG supplied by insured in reticulated system community kitchens other applications like geysers, lightning generator sets and irrigation pumps.
• In case cylinder was being connected to LPG installations and disconnected from LPG installation
• LPG used in Educational Institutions, research laboratories, government or municipal hospitals, mid-day meal schemes, social welfare institutions being run for child welfare, social welfare institutions.
• Restaurants, hotels, private hospitals or clinics poultry farms, grain drain, brick kilns, and ceramic industry using LPG.

Persons purchasing 5kg LPG cylinders under FTL scheme from LPG DISTRIBUTORS/RETAIL OUTLETS /KIRANA STORES ARE NOT INCLUDED IN THE POLICY.

IMMEDIATE RELIEF

In the case of occurrence of an accident requiring hospitalization of the victim, insurance will authorise relief of Rs. 25000 on confirmation of liability and production of “immediate relief certificate”  by authorized representative of insured. It can be settled in final settlement of the claim.

Insured has to bear a compulsory excess of Rs. 10000 for any one accident under Section I, this is applicable to death and bodily injury and also to property damage.

So this was all about the contents of the insurance policy signed between United Insurance Company Ltd. and Oil Marketing Companies comprising of the three insured company.In addition, to this if one goes through the website of these Oil companies then we will find that other than this comprehensive policy all LPG distributors have a different third party insurance policy to cover the interest of the consumers in case of any unfortunate events.

PROCEDURE TO CLAIM COMPENSATION

• In the case of any accident involving consumer’s installation, he/she has to inform the distributor of the gas company immediately. The distributor will inform the gas company and the insurance company at once.
• Whenever an accident is reported, the concerned Office in the nearby area of the oil company investigates the cause of the accident and if the accident is found to be LPG accident, the local office of the Insurance Company is notified by the concerned distributor / Area Office and then subsequently lodges a claim with the concerned Insurance Company.
• Customers are not required to apply to Insurance Company or to contact them directly.
• Customers are required to submit to the Oil Company the originals of Death Certificate(s) and Post Mortem report(s) /Coroners report/Inquest report, as applicable, in case of deaths and original Medical Bills, Doctors’ Prescriptions in original supporting the purchase of the medicines, Discharge Card in original and any other documents related to the hospitalization in case of injuries.
• In the case of property damage at customers’ registered premises, the Insurance Company will appoint their Surveyor to assess the loss and after assessing the loss will inform the insurance company about the claim on the damaged property.
• Claims are settled based on the merit of each case. The concerned Insurance Company takes a decision regarding settlement of the claim as per the provisions of Insurance Policies.

One should ensure all material like lighter and gas pipe should be ISI marked to claim successfully.

CONCLUSION

Thus, in the above article one can understand the basic pre-requisites and procedure to claim compensation in case of any LPG accidents. All the Oil Marketing Companies can’t make people aware of the existence of such insurance policies made for the benefit of protecting the rights of the consumer who become a victim of such unfortunate accident. They keep on paying a huge premium to the insurance companies which at the end of the day is of no use. So in case, some unfortunate event occurs in future, and one should realize their right and claim them.