Chinese industries that pollute the most heavily will be required to purchase coverage for damage compensation.
China has made a government insurance news announcement that will require the most heavily polluting industries to take part in a form of coverage program that will make certain that they are capable of providing compensation for the environmental damage that they cause.
The Communist Party in the country has placed a central focus on the pollution in the country.
This is the result of the considerable insurance news headlines that have been made in China, as the public has protested the issue quite vehemently, as it is an issue that is not easily concealed from locals or the world as a whole. The air quality has plummeted as the manufacturing sector continues to grow across the nation – particularly in urban areas.
This most recent insurance news release will make it mandatory for polluting companies to participate.
The types of businesses to which this insurance news will apply will include lead battery manufacturers, smelting industries, chemical factories, and leather goods firms. These were identified in a joint statement released by the China Insurance Regulatory Commission and the Environment Ministry of the company.
The insurance news statement also revealed that petrochemical companies that produce hazardous waste and that make hazardous chemicals will not be required to participate, but they will be encouraged to do so.
Companies that take out this pollution liability insurance may be eligible for financial assistance to cover the premiums through a special environmental protection fund that is designed for that purpose. The insurance news statement also said that these companies will be given a bank lending priority in order to assist them in raising the capital required to get things moving.
The organizations that choose not to apply for the pollution damage coverage could – according to the insurance news release – face certain consequences. This could include credit downgrades and negative environmental assessment, which could make it more challenging for those companies to develop. A pilot version of this program is already covering more than 2,000 businesses in 12 provinces, and has underwritten approximately $3.21 billion in risk.