
China tries mandatory environmental insurance
Government wants to make it compulsory for manufacturers to buy coverage against environmental damage
JEAN-FRANÇOIS TREMBLAY, C&EN HONG KONG
The Chinese government is on track to approve regulations requiring manufacturers in high-risk industries to buy environmental liability insurance. Draft regulations, supported by the Chinese Ministry of Environmental Protection and the China Insurance Regulatory Commission, were unveiled last month to allow industry and the public to comment. The next step will be approval by the State Council, the top organ in the Chinese government.
Some in the Chinese chemical industry support the move. “You need such insurance in the chemical industry,” says Shuguan Gan, chairperson of Jingzhou Jianghan Fine Chemical, a producer of silane coupling agents based in the central China province of Hubei. “The insurance helps the company to survive if it has an accident that affects the community.” Jianghan voluntarily purchased third-party environmental liability coverage several years ago, Gan notes. In the U.S., chemical producers don’t have to get insurance to cover their environmental liability, notes David J. Dybdahl, president of the American Risk Management Resources Network, an insurance broker specializing in environmental coverage. “Chemical companies may need to purchase environmental liability insurance if it is related to their waste streams, but
not their operations as a chemical company,” he says.
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