nuclear power plants third party nuclear liability insurance richard jones american nuclear insurers
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Nuclear Power PlantsNuclear Power PlantsNuclear Power PlantsNuclear Power Plants
Third Party Nuclear Liability Third Party Nuclear Liability InsuranceInsuranceThird Party Nuclear Liability Third Party Nuclear Liability InsuranceInsurance
Richard Jones
American Nuclear Insurers
ANI PolicyholdersANI Policyholders(U.S. Business)(U.S. Business)
Power ReactorsPower Reactors 103103 Support FacilitiesSupport Facilities 125125 Suppliers & TransportersSuppliers & Transporters 220220
Worldwide ReinsuranceWorldwide ReinsuranceOperationsOperations
JapanJapan GermanyGermanyKoreaKorea U.K.U.K.ChinaChina FranceFranceTaiwanTaiwan SpainSpainMexicoMexico SwedenSwedenSouth AfricaSouth Africa Czech Republic Czech RepublicFinlandFinland Slovak RepublicSlovak Republic
Price-Anderson Price-Anderson Enacted In 1957 To:Enacted In 1957 To:
• Encourage The Private Development Of Encourage The Private Development Of Nuclear Power.Nuclear Power.
• Establish A Legal Framework For Potential Establish A Legal Framework For Potential Liability Claims.Liability Claims.
• Provide A Ready Source Of Funds To Provide A Ready Source Of Funds To Compensate Injured Victims Of A Nuclear Compensate Injured Victims Of A Nuclear Accident.Accident.
Nuclear Insurance Nuclear Insurance Pooling System Pooling System EstablishedEstablished
Initial capacity is $60 million. The federal portion of the indemnity was $500 million.
The Omnibus Definition of Insured is developed.
Three Fundamental Three Fundamental Concepts:Concepts:
• Definition of InsuredDefinition of Insured• Policy Period and LimitsPolicy Period and Limits• Defense Costs Within LimitsDefense Costs Within Limits
1967...
• The Price-Anderson Act Is Renewed.
• The Definition of Extraordinary Nuclear Occurrence “ENO” Is Added To The Act.
Insurance Pools waive most tort defenses in the case of an “ENO.”
Court Challenge to Court Challenge to Price-AndersonPrice-Anderson
Carolina Environmental Study GroupCarolina Environmental Study Groupet al v. Duke Power Companyet al v. Duke Power Company
U.S. Supreme Court rules in 1978 U.S. Supreme Court rules in 1978 that the Act, including the limit of that the Act, including the limit of liability is constitutional.liability is constitutional.
1973…
1977…1977…
• Price-Anderson again renewed.Price-Anderson again renewed.• Second layer of protection added.Second layer of protection added.• $5 million per operating reactor.$5 million per operating reactor.• Federal layer of protection out Federal layer of protection out
when The 80th reactor is when The 80th reactor is licensed.licensed.
1988...1988...
Price-Anderson renewed For 15 Price-Anderson renewed For 15 yearsyears
Definition of public liability Definition of public liability expanded to include some costs expanded to include some costs of evacuationof evacuation
ANI Develops Liability Coverage “D”
Liability Coverage “D”Liability Coverage “D”
Reasonable Reasonable additionaladditional costs for costs for• FoodFood• ShelterShelter• TransportationTransportation• Police ServicesPolice Services
For Time Evacuation Order Is In For Time Evacuation Order Is In Effect + 30 DaysEffect + 30 Days
Financial ProtectionFinancial Protection
Evolution of Limits...Evolution of Limits...
0
50
100
150
200
250
300
Millions($)
1957 1969 1974 1977 1988
ANI - History of Liability Limits
Lim it Increased To $300 Million Effective 01/01/03
Secondary Financial Secondary Financial ProtectionProtection
$140
$310
$110
0
250
500
750
1,000
Mill
ion
s o
f Do
llars
Secondary Financial Protection Program - August 1, 1977
GovernmentIndemnity
SFP
ANI
$300
$10,300
0
2,500
5,000
7,500
10,000
Milli
ons
of D
olla
rs
Secondary Financial Protection Program - November, 2003
GovernmentIndemnity
SFP
ANI
ANI Response To The ANI Response To The Three Mile Island Three Mile Island AccidentAccident
TMI - The first two TMI - The first two days...days... March 28, 1979March 28, 1979
• 0400 Accident 0400 Accident OccursOccurs
• 0730 ANI0730 ANI NotifiedNotified
March 29, 1979March 29, 1979• ANI Personnel Arrive ANI Personnel Arrive
In PennsylvaniaIn Pennsylvania• Local Claims Office Local Claims Office
AuthorizedAuthorized• 51 Claims Adjusters 51 Claims Adjusters
Recruited From Recruited From Member CompaniesMember Companies
TMI - The Evacuation TMI - The Evacuation AdvisoryAdvisory
March 30, 1979 March 30, 1979 • Pennsylvania Pennsylvania
Governor Richard Governor Richard Thornburgh Thornburgh Issues An Issues An Advisory Advisory Evacuation NoticeEvacuation Notice
TMI - Opening of the TMI - Opening of the Claim OfficeClaim Office
• ANI’s claim office ANI’s claim office is open for is open for business within business within 20 hours of the 20 hours of the Advisory Advisory Evacuation Evacuation Notice.Notice.
TMI - ANI ResponseTMI - ANI Response
• ANI alerts media (television, radio ANI alerts media (television, radio and newspapers) of the location of and newspapers) of the location of the claims office.the claims office.
• More than $2 million in evacuation More than $2 million in evacuation claims will be paid.claims will be paid.
• More than $70 million in claims and More than $70 million in claims and legal expenses are paid.legal expenses are paid.
Terrorism CoverageTerrorism Coverage
ANI Covers Terrorism Losses Subject ANI Covers Terrorism Losses Subject To The Terms And Conditions Of Our To The Terms And Conditions Of Our Policies And Certified By The Policies And Certified By The Terrorism Terrorism Risk Insurance Act Of 2002 Risk Insurance Act Of 2002 (TRIA).(TRIA).
An Industry Aggregate Limit Applies To An Industry Aggregate Limit Applies To Losses From Terrorism Not “Certified” Losses From Terrorism Not “Certified” By TRIA.By TRIA.
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