A major reinsurance company has advised insurance companies that they may need to reconsider covering products manufactured using nanotechnology until more is known about any possible side effects of the technology. ‘As a major risk carrier, the insurance industry can only responsibly support the introduction of a new technology if it can evaluate and calculate its inherent risks,’ says Swiss Re. ‘A risk needs to be identified before its consequences can be measured and a decision can be reached on the optimal risk management approach.’
From the European Union:
Insurance industry warned of nanotechnology risks
A major reinsurance company has advised insurance companies that they may need to reconsider covering products manufactured using nanotechnology until more is known about any possible side effects of the technology.
‘As a major risk carrier, the insurance industry can only responsibly support the introduction of a new technology if it can evaluate and calculate its inherent risks,’ says Swiss Re. ‘A risk needs to be identified before its consequences can be measured and a decision can be reached on the optimal risk management approach.’
Swiss Re is therefore calling for an open risk dialogue involving industry, scientists, regulators and the insurance sector. The recommendation is contained in the report ‘Nanotechnology: small matter, many unknowns’.
Annabelle Hett, a risk expert at Swiss Re, pointed out that the existence of nanoparticles does not necessarily pose a threat to people or the environment. ‘A risk can only arise if some of the particles’ properties turn out to be harmful,’ she said. As yet, ‘insufficient research has been done to say with any certainty whether, and if so to what extent, nanoparticles or products containing nanoparticles actually pose a threat.’
Some research suggests a real health threat from nanotechnology. US researchers recently found that nanoparticles are able to cause brain damage in fish. Swiss Re is hesitant about transferring this risk to humans, but points out that in order to know the risks for sure, studies would have to be carried out on human beings, which is unrealistic.
A concern for many insurance companies could be that claims such as those related to asbestos exposure could be repeated. Recent illness-related claims have sometimes dated back to exposure in the 1970s, and have cost insurance companies billions of euro.
A number of new nanotechnology products were launched commercially following a relatively short phase of research and development. ‘[S]pecialist circles and society at large have neither solid knowledge derived from the past nor a suitable method for definitely assessing the consequences of any changes that may arise in the future,’ states the Swiss Re report.
Swiss Re has teams of experts that track new or emerging risks, and nanotechnology is considered to fall into this category. Insurance companies should take heed, believes Swiss Re. ‘After all, it is vital for the insurance industry to know what losses a new technology can give rise to and what the extent and the frequency of such losses will be. With these basics more or less established, the insurer can better assess the future loss burden, calculate a premium commensurate with the risk and grant adequate insurance cover.’
To access the Swiss Re report, please consult the following web address:
http://www.swissre.com