Compulsory
Ecological Insurance
Law of the Azerbaijan Republic “On
Mandatory Environmental Insurance” took effect in April
2002.
The Law applies to enterprises involved in processing,
utilization, storage and land disposal of radioactive substances;
oil and gas production, as well as drilling companies, companies
that produce chemical substances and products, thermoelectric
power stations, main gas and oil pipelines, enterprises
specializing in transportation of oil and products of petroleum
refinery and liquid chemical products, as well as radioactive
and other harmful substances; filling stations.
Pursuant to this law, all natural and legal
persons, whose activities are related to extraction, production,
processing, transportation, land disposal, removal and utilization
of substances hazardous for the environment are obliged
to insure their legal commitment for inflicting harm to
life and the health of third persons and/or damage their
property as a result of environmental pollution.
In the framework of this law, costs for compensating
material damage connected with inflicting harm to life and
the health of third persons and/or damage to their property
are covered by insurance, as well as damage caused to animals
and plants as a result of pollution resulting from an accident
or manmade disaster.
The insurance coverage includes also costs
incurred to cleanse land and the atmosphere. The insurance
terms, fees and rates are set in accordance with the law
“On Mandatory Environmental Insurance” depending on the
specifics of the work of an organization or an enterprise.