LMA publishes new nuclear exclusion clauses

The first in a series of new nuclear and radioactive contamination exclusion clauses has been published by the Lloyd’s Market Association (LMA).

The LMA’s Nuclear Exclusions Working Party, comprising representatives of both Lloyd’s and the London companies market, has developed six new clauses for treaty reinsurance business and these are available to the market via Lloyd’s Wordings Repository.

Neil Smith, the LMA’s head of underwriting, said: “Most of the 19 nuclear exclusion clauses commonly used in the Lloyd’s market date back to the early days of the international nuclear industry in the 1950s and 60s. Since then, technology has advanced, legal jurisdictions have changed and the world has generally moved on.

“The initiative to redraft these clauses will bring the market’s wordings into line with current technology while ensuring they are transparent and offer clarity of coverage.”

The current review was begun in the wake of the explosions at Japan’s Fukushima Daiichi nuclear plant in 2011 following the earthquake and tsunami. The so-called nuclear renaissance, which is seeing substantial levels of nuclear power plant construction around the world, including 170 in China, also influenced underwriters’ desire to review and redraft the clauses.

The decision to review the reinsurance treaty clauses first was because these were seen to be the most complex and widely used in the Lloyd’s market.

The working party will be looking at the remaining sets of nuclear clauses early in 2013.

    Share Story:

Recent Stories

Cyber physical risks
Property damage as a consequence of cyber attack is often excluded from standard property policies, but as the industrial internet of things expands, so too do the risks. This podcast examines the evolving threat landscape. Published October 2021

Financial institutions were early adopters of cyber security and insurance. Are they still on top of the game?
Managing huge amounts of sensitive data online makes financial institutions a prime target for hackers. As such, the sector was an early cohort for insurers in creating cyber cover. Since then, the market has evolved almost beyond recognition. It continues to challenge itself to this day, complying with rigorous regulatory demands and implementing avant-garde enhancements to keep abreast of the ever-changing risks. Published June 2021