4 ms·

Are they insuring densely populated countries against the consequences of disastrous nuclear reactor accidents?

by Slartie 4y ago

michaelt 4y ago
I suspect even a company that claims to 'insure anything' would balk at things needing a $200 billion payout.
- Sebb767 4y ago
  Well, there's always the strategy of 'take the payouts, go insolvent in case the event really happens'. But, on the other hand, such a high possible payout would probably come with insane premiums that might make it viable (for the insurance, not the country).
- yardstick 4y ago
  Depends on the premium they would charge.
throwaway2037 4y ago
Are you thinking of Belgium, Korea, Taiwan, or Japan?
woutifier 4y ago
For nuclear reactor incidents there are reinsurance pools. A collective of insurance companies. For example the nuclear reactor in Borssele, The Netherlands, is insured backed by 26 of such collectives (one national, and 25 foreign collectives) together they consist of over 300 individual insurance companies. This particular (small) reactor is insured for liability up to 1.2 billion euro.
- mschuster91 4y ago
  The problem is, the followup costs for a nuclear reactor disaster can easily reach multiple trillions of euros - and no plant is adequately insured. In Germany, they did the maths [1] in the wake of the 2011 Fukushima disaster and found out that decent insurance would cost 72 billion euros a year in premiums - a move that would raise electricity prices from 20 ct/kWh to 4 euros/kWh. We have been ignoring that massive risk in favor of "cheap" electricity for decades, and every time something happened, in the end the taxpayers had to cover the bill. Nuclear simply is financially unviable once externalities are properly accounted for. Add to that cost and time overruns in projects, the still unsolved questions of where to dump the waste, of nuclear weapon fuel proliferation... and just forget about fission-based nuclear projects, please. [1] https://www.manager-magazin.de/finanzen/versicherungen/a-761954.html https://www.manager-magazin.de/finanzen/versicherungen/a-761...
  - Chris2048 4y ago
    Given Chernobyl cost about around 235 billion USD to cleanup - What constitutes "decent insurance"? How much are they expecting to pay out?
    - mschuster91 4y ago
      It's not just the direct cleanup costs - the number goes up extremely hard if you also attempt to account for externalized costs that are rarely grouped together: - loss of life and the economic productivity of people who died early (not just the liquidators, but also everyone who got radiation damage!) - loss of sellability of goods - to this day, Bavarian shroom collectors and hunters have to check fungi or wild animals for radiation, and in particularly bad years up to 70% of wild pigs have to be discarded due to irradiation [1]. That's an economic loss for the hunters and for all subsequent economic activities (butchers, restaurants). - healthcare cost associated with dealing with the fallout - cancers are the most expensive illnesses known to mankind - loss of quality of life in those who were displaced by the Chernobyl and Fukushima disasters, additionally also the cost of relocating and the loss of opportunities, social networks etc. caused by the relocating - loss of economic potential that could have been realized in the area around Chernobyl, had it not been contaminated [1] https://www.welt.de/wissenschaft/article230648425/35-Jahre-nach-Tschernobyl-Ungeniessbares-Wildfleisch-in-Bayern.html https://www.welt.de/wissenschaft/article230648425/35-Jahre-n...
      - Chris2048 4y ago
        But are these the kinds of costs that are accounted for by an insurer? Have local hunters/butchers/restaurants managed to get compensation for loss of revenue? Also, these costs seem specific to a melt-down. Fukushima wasn't just poorly insured, it failed to heed studies warning about its location.
  - ff317 4y ago
    Yes, but, you could also say the same of fossil fuel power plants as well. The world has been getting "cheap" electricity from fossil fuels for many decades now while ignoring the environmental (and other, like nuclear waste problems from Coal) externalities that taxpayers ultimately have to face one way or another as well. You'd need a comparative analysis of the externalities of both to make sense of the trade-offs and pick one that's "better". Renewables like solar and wind are great of course, but they're intermittent and cause weird issues like the Duck Curve. You still need base load from either nuclear or fossil fuels for a stable, reliable grid.

Are they insuring densely populated countries against the consequences of disastrous nuclear reactor accidents?

michaelt 4y ago

I suspect even a company that claims to 'insure anything' would balk at things needing a $200 billion payout.

Sebb767 4y ago
Well, there's always the strategy of 'take the payouts, go insolvent in case the event really happens'. But, on the other hand, such a high possible payout would probably come with insane premiums that might make it viable (for the insurance, not the country).
yardstick 4y ago
Depends on the premium they would charge.

throwaway2037 4y ago

Are you thinking of Belgium, Korea, Taiwan, or Japan?

woutifier 4y ago

For nuclear reactor incidents there are reinsurance pools. A collective of insurance companies. For example the nuclear reactor in Borssele, The Netherlands, is insured backed by 26 of such collectives (one national, and 25 foreign collectives) together they consist of over 300 individual insurance companies. This particular (small) reactor is insured for liability up to 1.2 billion euro.

mschuster91 4y ago
The problem is, the followup costs for a nuclear reactor disaster can easily reach multiple trillions of euros - and no plant is adequately insured. In Germany, they did the maths [1] in the wake of the 2011 Fukushima disaster and found out that decent insurance would cost 72 billion euros a year in premiums - a move that would raise electricity prices from 20 ct/kWh to 4 euros/kWh. We have been ignoring that massive risk in favor of "cheap" electricity for decades, and every time something happened, in the end the taxpayers had to cover the bill. Nuclear simply is financially unviable once externalities are properly accounted for. Add to that cost and time overruns in projects, the still unsolved questions of where to dump the waste, of nuclear weapon fuel proliferation... and just forget about fission-based nuclear projects, please. [1] https://www.manager-magazin.de/finanzen/versicherungen/a-761954.html https://www.manager-magazin.de/finanzen/versicherungen/a-761...
- Chris2048 4y ago
  Given Chernobyl cost about around 235 billion USD to cleanup - What constitutes "decent insurance"? How much are they expecting to pay out?
  - mschuster91 4y ago
    It's not just the direct cleanup costs - the number goes up extremely hard if you also attempt to account for externalized costs that are rarely grouped together: - loss of life and the economic productivity of people who died early (not just the liquidators, but also everyone who got radiation damage!) - loss of sellability of goods - to this day, Bavarian shroom collectors and hunters have to check fungi or wild animals for radiation, and in particularly bad years up to 70% of wild pigs have to be discarded due to irradiation [1]. That's an economic loss for the hunters and for all subsequent economic activities (butchers, restaurants). - healthcare cost associated with dealing with the fallout - cancers are the most expensive illnesses known to mankind - loss of quality of life in those who were displaced by the Chernobyl and Fukushima disasters, additionally also the cost of relocating and the loss of opportunities, social networks etc. caused by the relocating - loss of economic potential that could have been realized in the area around Chernobyl, had it not been contaminated [1] https://www.welt.de/wissenschaft/article230648425/35-Jahre-nach-Tschernobyl-Ungeniessbares-Wildfleisch-in-Bayern.html https://www.welt.de/wissenschaft/article230648425/35-Jahre-n...
    - Chris2048 4y ago
      But are these the kinds of costs that are accounted for by an insurer? Have local hunters/butchers/restaurants managed to get compensation for loss of revenue? Also, these costs seem specific to a melt-down. Fukushima wasn't just poorly insured, it failed to heed studies warning about its location.
- ff317 4y ago
  Yes, but, you could also say the same of fossil fuel power plants as well. The world has been getting "cheap" electricity from fossil fuels for many decades now while ignoring the environmental (and other, like nuclear waste problems from Coal) externalities that taxpayers ultimately have to face one way or another as well. You'd need a comparative analysis of the externalities of both to make sense of the trade-offs and pick one that's "better". Renewables like solar and wind are great of course, but they're intermittent and cause weird issues like the Duck Curve. You still need base load from either nuclear or fossil fuels for a stable, reliable grid.