The Coalition for Full Nuclear Accountability is a coalition of national organizations representing a diverse set of interests and constituencies. The goal of accountability in the nuclear industry has brought together organizations with differing opinions on the desirability of nuclear power. As a whole, the Coalition is neither working to shut-down the nuclear industry nor encouraging its continued development. We are working to put the normal checks and balances of tort liability and free-market risk assessments onto the nuclear industry. At the same time, we are demanding that private citizens-individuals, property, home and business owners-be allowed the opportunity to purchase property insurance protecting them from nuclear risks. The Coalition is both a resource and a lobbying organization. We will send out legislative alerts and updates on Capital Hill activity. We can answer questions not covered in this booklet, as well as provide additional resource materials. This handbook was written by Keiki Kehoe and published by the Environmental Policy Center for the Coalition for Full Nuclear Accountability. Kehoe is a Washington Representative of the Center and Coordinator of the Coalition. The Environmental Policy Center was founded as a national citizen's lobby organization in 1972. The Center works to reduce America's dependence on foreign oil and nuclear power. It promotes energy and water conservation; the safe, clean use of coal, oil and gas, and the increased use of renewable sources of energy. EPC builds support for its work by forming and participating in diverse citizen coalitions, including local, regional, and national organizations. For more information contact: The Environmental Policy Center 317 Pennsylvania Ave., S.E. 202/547-5330 C 439 subcommittee to present my views on repeal of the Price Anderson Act. My name is Ron M. firm of Landsman & Laster, National Insurance Consumer Landsman. I am a partner at the law Independent Advisory Committee to the Nuclear Risk Task Force of the National Association of Insurance Commissioners. I am appearing today on behalf of the National Insurance Consumer Organization. NICO is a public interest group created to educate and assist the public on matters relating to insurance of all kinds. Its founder and president is Robert Statement of Ron M. Landsman Hearings on Repeal of the Price-Anderson Act June 11, 1984 Page--2- Mr. Hunter and I have had occasion to study the problem of insurance Independent for nuclear risks recently as members of the Advisory Committee to the NAIC Nuclear Risk Task Force. In response to consumer requests over some years, the NAIC in 1982 appointed a task force to study the problems created for consumers by the nuclear exclusion clause 1 contained in fire, homeowners, property, business and automobile policies issued in the United States today. The task force, consisting of nine state insurance commissioners, then created two advisory committees, one of insurance industry representatives and one of independent experts, to advise it with respect both to the nuclear exclusion clause and the Act. one The Independent Advisory Committee brings Price-Anderson place a wide range of experts the problems of the nuclear risk and how it can be insured against. Among the members are a scientist, an economist, an insurance expert, a state legislator, - a lawyer, an environmental expert Keiki and academicians in is William Wood, who also appearing before the Subcommittee today. Our should be available in the fall, will address questions with which this Committee is concerned. report, which many of the Statement of Ron M. Landsman Hearings on Repeal of the Price-Anderson Act June 11, 1984 Page--3- The Unanticipated Problem Created by the Price-Anderson Act The Price-Anderson - their the grave financial risk of losing all that they own -homes, their cars, their businesses and leaves them with no place to turn to protect themselves against that risk. This is not the result of Price-Anderson alone, to be sure. But property-liability insurers uniformly refuse to accept and spread individual exposure to nuclear hazards, rather excluding losses arising from all nuclear risks from standard fire, homeowners, and automobile insurance policies. The elimination of all first party coverage from the private insurance market by means of the nuclear exclusion clause is not an integral part of the Price-Anderson system. Nonetheless, Price-Anderson, in conjunction with nuclear exclusion clauses, results in forcing upon the public virtually all of the risk nuclear catastrophe. associated with a major The analysis by the Federal Insurance Administration of the potential loss to the public in the wake of Three Mile losses would have received 3 cents on the dollar, an effect whose devastation would be hard to overstate. Take as an illustration a retired couple whose home, Statement of Ron M. Landsman Hearings on Repeal of the Price-Anderson Act June 11, 1984 Page--4- valued at $100,000, is their only major asset and, because the mortgage has been paid off, would be entirely their loss were it destroyed. Under the FIA analysis, they would suffer an uncompensated loss of $97,000. They would have received in unfurnished apartment for not very many months. All the rest of the value of the home would be utterly and irrevocably lost. This couple's homeowners' insurance policy would provide them no protection. The nuclear exclusion clause precludes them from obtaining from their own insurer any benefits related to a loss caused by a nuclear hazard. Moreover, because all companies employ this exclusion, this couple could not have secured insurance for themselves against nuclear risks at any price. NICO has for some time sought from the property-liability insurance industry some quantification of the risk that is at stake here. We have not been alone in asking, but others, such as the NAIC, have been equally unsuccessful over the past eight years in obtaining from insurers their assessment of the cost of eliminating nuclear exclusion clauses. 2/ |