NRI Annual Review 2023 - Flipbook - Page 7
WHAT MAKES
NUCLEAR
INSURANCE
DIFFERENT
FROM
CONVENTIONAL
INSURANCE?
There are three things that
make nuclear insurance
fundamentally different from
conventional insurance.
The first of those is the mechanism by which
people are protected in the way they make
claims. With nuclear insurance, if someone
feels they have been harmed or their property
damaged by a release from a nuclear site,
third-party liability enables them to claim
directly against the licensed site operator. This
is known as channelling, and allows insurers
to know exactly where all the claims for a
particular incident are going to come, giving
them complete visibility of their exposure,
given that it can be catastrophic in nature.
Second, nuclear insurance also covers the
operator for damage caused on-site. It
should generally be a much lower risk than
other industries, because of the high levels
of nuclear safety culture built into working
practices in the nuclear industry.
Third, nuclear insurance is special because
the insurer’s capacity, sitting behind the
insurance, is what is known as “net capacity”.
Nuclear insurers do not rely on reinsurance to
cover themselves; they have to have enough
money sitting in their account to be able to
pay the victims of an incident immediately.
Using well-proven
insurance products, NRI
is able to cover these
new applications and
meet the demands of a
changing market.
By By Dr Tim Stone CBE,
Chairman at NRI
NRI has existed in different corporate
forms since 1956. NRI’s underwriters, who
understand the industry and its history,
enable the organisation to properly assess
risk and then provide a full service to clients.
NRI has a team of engineers supporting the
underwriting team who provide gold standard
analysis of the risks associated with the
insurance cover we provide to nuclear power
plants and facilities: they assess sites, culture,
behaviours, plant and maintenance. They are
there to help operators, and that relationship
is very important.
NRI’s scale and expertise allow it to develop
solutions for issues such as cyber security,
business interruption or construction, and
ensure that they are right for the client’s
needs. The understanding of the technical
and actuarial risk is deep and substantial, and
is then priced as keenly as possible to balance
the trade between the insured and the
members of NRI who provide that capacity.
For any insured covered incident at scale,
NRI will write a cheque on the spot. There is
no quibbling.
Over the next decade, the need for nuclear
insurance will increase as more and more new
plants are brought online, as without nuclear
there is no net zero. As a result, the future for the
nuclear insurance industry is extremely positive.
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