Reliance Takes Rs 9000cr Cover For Jamnagar

In keeping with the Reliance tradition of thinking big, Reliance Petroleum Ltd has bought the largest insurance cover ever issued in the country. The company has insured its 15 million tonne Jamnagar refinery project for Rs 9,000 crore.

Oriental Insurance Company has picked up 80 per cent of the business, while New India Insurance will provide the remaing cover. The two public sector companies will, however, retain only 3-4 per cent of the cover and resell the rest to international re-insurers.

Oriental and New India have already booked reinsurance giants Swiss Re and Munich Re, besides half-a-dozen professional reinsurers with triple A ratings. General Insurance Corp, the holding company for all insurance PSUs in India, is also picking up a small share of the re-insurance business. Though we have initially booked 100 per cent, the re-insurance limit will be brought down to 96 per cent or so after the negotiations with reinsurers are completed, a senior Oriental official told Business Standard.

 

The policy has been sold at a base premium price of 2.2 per cent, Oriental Insurance sources said. However, RPL will have to pay only Rs 30 crore as premium for the 30-month construction period that began last month as the first consignment of machinery moved into the project site in Jamnagar.