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FINANCIAL PROTECTION AGAINST NUCLEAR HAZARDS: THIRTY YEARS' EXPERIENCE UNDER THE PRICE-ANDERSON ACT

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THE LEGISLATIVE DRAFTING RESEARCH FUND

OF

COLUMBIA UNIVERSITY

FRANK P. GRAD, Director

LAURIE R. ROCKETT, Associate Director

R. ALTA CHARO, Associate Director
ILEEN HAYN, Staff Attorney

MANDY VINCENT, Executive Secretary

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Financial Protection Under the Price-Anderson Act
A. The Price-Anderson Act of 1957

1. Financial Protection Provided by Private Industry
2. Federal Indemnity

3. Rationale of the Original Legislation

B. Modifications in the Price-Anderson System, 1957-1983
C. The Duke Power Case

D. Implementation of the Act by Industry and the AEC
1. The Insurance Industry

(a) The Pools ....

(b) The Insurance Policies

(c) Industry Credit Rating Plan

(d) Nuclear Exclusions in Conventional Property and
Liability Policies

(e) Insurance Available to Non-Indemnified Com-
panies

(f) Operating Experience

(g) The Accident at Three Mile Island and the Re-
sponse of the Insurance Pools

(h) Other Functions of the Insurance Industry

2. The Indemnity Agreements

Footnotes for Chapter 2

Chapter 3:

Financial Protection in the Absence of the Price-Anderson Act

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A. Theories of Liability

....

1. Tortious Operation or Conduct of an Activity

(a) Negligence and Strict Liability

(b) Trespass

(c) Nuisance

(d) Summary

2. Product Liability

(a) Strict Liability

(b) Warranty
(c) Negligence

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(iv) Statutes of Limitations

2. Difficulties of Proof

3. Difficulties in Obtaining Satisfaction of Judgment

C. Alternative Sources of Protection

1. The Insurance Market

2. Contractual Agreements

3. Separate Incorporation

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D. Financial Protection in the Absence of Price-Anderson: A
Summary ...

1. For the Industry

2. For the Public

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Footnotes for Chapter 3

Chapter 4:

Legislative Resolution: Fundamental Policy Issues and
Criteria

A. Issues to be Considered

1. The Relationship Between Allocation of Liability and
Minimization of the Risk ..

2. Government Influence on the Participation of Private
Industry in the Development of Nuclear Energy

B. Goals of the Legislation ...

1. Provision of Adequate Compensation

2. Spreading the Risk

3. Avoidance of Externalization

4. Avoidance of Undue Costs

C. Summary

Footnotes for Chapter 4

Chapter 5:

Alternative Proposals

A. Introduction ...

B. Alternative Proposals

1. Extension of Existing Law

2. Proposals to Modify the Price-Anderson Act

(a) Increasing the Level of Financial Protection

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(i) Elimination of the Limitation on Liability...

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(ii) Imposition of an Annual Limitation on Liabil-
ity ....

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(iii) Increase in the Retrospective Premium As-
sessments

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(iv) Miscellaneous Measures to Increase the Level
of Financial Protection .....

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(b) Methods of Funding Increased Financial Protec-
tion...

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(c) Changes in Substantive Law

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(i) Adoption of a Probability of Causation Ap-
proach

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(ii) Elimination of the Concept of the ENO
(iii) Extension of the Waiver of Statutes of Limita-

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tions

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Footnotes for Chapter 5

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