Public Liability Insurance Act, 1991
6. Establishment and administration of fund
2[(1) An owner seeking exemption under sub-section (3) of section 4 of the Act, shall with the prior approval of the Central Government create and maintain a fund for an amount of Rs.5 crores or for an amount equal to the paid-up capital of the undertaking handling hazardous substances, whichever is less, in the State Bank of India or any of its subsidiaries or any nationalised bank, and which will be available readily for meeting the liability of that owner under the Act.]
(2) The fund to be created shall be utilized for the purpose of meeting the liability arising out of any claim awarded against the owner who has created the fund and to discharge the amount awarded by the Collector.
(3) The fund shall be operated by an administrator to be nominated by the owner. The owner shall notify the nomination of the administrator to the Central Government.