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The Actuary The magazine of the Institute & Faculty of Actuaries

Nuclear hazards

Even before 11 September 2001, there was growing concern among property insurers and reinsurers regarding political risks, and the risk of terrorism in particular. International terrorism cannot yet be assessed precisely enough in terms of its frequency and severity, and the entirely new loss dimension experienced with 11 September 2001 clearly demonstrated the limits of insurability to the entire insurance industry.

The reassessment of nuclear risks has brought to light certain gaps in property (re)insurance and revealed that the introduction of various national and private terrorism schemes has failed to improve the situation. The existing uncertainties and shortcomings in various markets and the necessity to exclude the nuclear risk entirely from property reinsurance have fuelled efforts to establish flawless exclusion clauses in the relevant treaties.

For the new focus report, Nuclear risks in property insurance and limitations of insurability, written by specialists from Swiss Re’s chief underwriting office, visit www.swissre.com. Also to be found on the Swiss Re website is the latest issue of sigma: ‘Emerging insurance markets: lessons learned from financial crises’.