Technical annexes

• Author: Directorate-General for Energy (European Commission), ENCO
• Pages: 135-171

Final Report - MOVE/ENER/SRD/2016-498 Lot 2

Study on the insurance, private and financial markets in the field of nuclear third party liability

Page 135

TECHNICAL ANNEXES

1. SELF-INSURANCE - NUCLEAR INSURANCE MUTUALS

Self-insurance - Mutual Insurance Entities (ELINI, NIRA & BLUE RE)

European Liability Insurance for Nuclear Installations (ELINI), Nuclear Industry Reinsurance Association

(NIRA) and Blue Re together are the nuclear industry mutual insurance entities216 through which the

nuclear industry outside o f the USA provides most of its self-insurance NTPL capacity. These entities

provide the principal competition for the nuclear pools in Europe and today bring substantial nuclear

third-party liability insurance capacity to the market; critically these entities are today the largest

source of capacity that is willing to provide the full scope of cover required under the revised nuclear

liability Conventions, i.e. cover for the extended prescription period for bodily injury (to 30 years).

ELINI

Background

ELINI is a Belgian mutual insurance association and was founded in 2002; it was created to provide

insurance capacity for nuclear third-party liability for its Members. Today it provides nuclear liability

capacity for Members globally, despite its European origins.

ELINI largely operates like an insurance company and it offers insurance policies to its Members and

others with material capacity as a leader, coinsurer, reinsurer or as a stand-alone capacity provider

where its capacity is sufficient.

It has its own risk rating model and can thus offer competitive terms in the nuclear liability market.

ELINI is permitted to buy reinsurance cover to supplement its capacity, subject to board approval.

ELINI is rated by A.M. Best217 as A  (stable)218.

Membership

Members of the Association can only be companies or authorities in the private or public sector (or

their representatives) with an insurable interest in operating, controlling or owning a nuclear

installation.

There are two main types of Members:

216 A mutual insurance company is owned by its policyholders.

217 A.M. Best is the only ratings agency that specialises solely in the insurance industry. Its rating system focuses on an

insurer's claims paying ability and the credit quality of its obligations.

218 On September 18, 2015, A.M. Best has assigned a financial strength rating of A- (Excellent) and an issuer credit rating of

- to ELINI. The outlook assigned to both ratings is stable. (source: https://www.elini.net/about/ )

Final Report - MOVE/ENER/SRD/2016-498 Lot 2

Study on the insurance, private and financial markets in the field of nuclear third party liability

Page 136

1. Non-insured Members219 who do not take part in the constitution of the guarantee fund

but pay an administrative fee (shown in red in the table below);

2. Insured Members who have an insurance policy and have contributed to the constitution

of the guarantee fund.

Table 15: Current ELINI Members

Country

Operator/site - Member

Belgium

Belgoprocess NV

Belgium

Electrabel S.A.

Belgium

FBFC International BV

Belgium

SCK-CEN

Belgium

IRE

Belgium

Transrad

Belgium

Transnuclear

Canada

Bruce Power

Canada

New Brunswick Power

Canada

Ontario Power Generation

Czech Republic

CEZ a.s.

Finland

Fortum Power and Heat Oy

Finland

Teollisuuden Voima Oyj (TVO)

France

Eurodif

France

EDF

France

Orano

Germany

EnBW Kernkraft GmbH

Germany

PreussenElektra GmbH

Germany

RWE Power AG GmbH

Hungary

MVM PAKS Nuclear Power Plant Ltd.

Hungary

RHK Puram

Italy

ENEL

Italy

SOGIN

Netherlands

EPZ NV

Romania

SNN (Societatea Nationala Nuclearelectrica)

Slovak Republic

Slovenske Elektrarne a.s.

South Africa

ESKOM

Spain

ENDESA S.A.

Sweden

AB SVAFO

Sweden

Forsmark Kraftgrupp AB

Sweden

OKG Aktiebolag

Sweden

Ringhals AB

Sweden

Svensk Karnbranslehantering AB

Sweden

Studsvik AB

Sweden

Sydkraft Nuclear Power AB

219 Non-insured members are those that have joined the mutual but have not yet taken an insurance policy. The ELINI

membership rules sta A new Member must take out or have the intention to take out at a later stage at least one

insurance policy  ELINI ‘  A 

Final Report - MOVE/ENER/SRD/2016-498 Lot 2

Study on the insurance, private and financial markets in the field of nuclear third party liability

Page 137

Country

Operator/site - Member

Switzerland

Axpo Trading AG

Switzerland

BKW Energie Ltd.

Switzerland

Kernkraftwerk Gösgen-Däniken AG

Switzerland

Kernkraftwerk Leibstadt AG

Switzerland

Zwischenlager Würenlingen AG

United Kingdom

British Energy Ltd

United Kingdom

Urenco Ltd.

Guarantee fund

Since starting in 2002, ELINI has built up a guarantee fund220 and an equalisation reserve221 that

    B  ELINI own funds    

At the close of each year, a proportion of the underwriting surplus222 is moved to the guarantee fund

to support further expansion of the capacity.

Paying for a valid claim

In the event of a large single claim, ELINI can draw upon its guarantee fund which is enough to cover

its net retention223; thereafter it can claim from its reinsurers.

Should multiple losses occur that exhaust the funds available, ELINI can call upon its Members for

additional funds.

Under this arrangement ELINI Members have a maximum liability of up to 20 calls, covering up to 3

            M  ribution

(premium).

Capacity

F  ELINI     -    million     

million.

T       million, as it was in 2017. For 2019 the net retention increased to

 million.

Scope of cover

ELINI is unique amongst the current nuclear insurance market players as it offers the full scope of cover

      C         

prescription period, which is not the case for most other market players.

220 ELINI                ted surpluses.

221 An equalisation reserve is a long-term reserve that an insurance entity keeps to prevent cash-flow depletion in case of a

   I ELINI     smooth out claims    exceptional risks (see ELINI

annual reports)

222 Underwriting surplus is the difference between the total premium contributions paid during a certain period of time

and indemnities paid in respect of claims, net of reinsurance and other expenses incurred during the same period.

223 In reinsurance, the net retention is the net amount of risk the ceding company (insurer) keeps for its own account.

Exposure above this amount is ceded to the reinsurer(s).