Munich Re supports considerations regarding extended liability regulations for nuclear risks

2012/10/09

The decision to use nuclear energy in future is a political decision to be taken in the respective member states, weighing up the risks and benefits. In view of the considerable differences in national conditions surrounding the operation of nuclear power plants, the proposals submitted by European Commissioner Günther Oettinger regarding extended liability conditions and compulsory insurance for nuclear risks merit support.

Munich. Board member Torsten Jeworrek said: "It makes economic sense to transfer risks using insurance solutions, because a price is placed on them and this is taken into account in the final product. The same applies to nuclear risks. Munich Re will support considerations regarding extended liability insurance cover for such risks. A review of European liability regulations, as proposed by the European Commission, and their subsequent harmonisation, will be necessary. Given the potentially substantial impact of nuclear risks, the insurance industry can only provide cover subject to certain limits, although these could be set considerably higher than in the past. Under these conditions, we regard obligatory insurance as a feasible solution."

"Providing cover for complex risks that are difficult to calculate is part of the insurance industry's role and generates economic benefit. Under certain circumstances – uniform liability, appropriate limits, risk-commensurate prices – this is also possible in the case of nuclear risks", added Jeworrek. Owing to the very rare but extremely high loss potential associated with these risks, it is unavoidable that – in addition to the insurance industry – the operators of nuclear power plants and the state continue to be involved as risk carriers in future.

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