Malta-Based Lloyd’s Managing Agent Targets Global Nuclear Market

A new Malta-based Lloyd's managing agent specializing in nuclear insurance was launched with the backing of Amlin plc, broker Marsh Inc and Marsh's sister company Guy Carpenter.

The new managing agent, Northcourt Ltd., brings the first new capacity to the global nuclear insurance market "in more than a generation," according to Northcourt.

At the outset, Northcourt will provide property damage and business interruption insurers of up to US$200 million. Northcourt said it anticipates expanding into nuclear liability and construction in 2012.

Northcourt will be led by Chief Executive Alan Rickett, who was previously a senior vice president at global insurance broker and risk adviser Marsh. It is registered in Malta and licensed to underwrite nuclear business on a global basis, regulated by the Malta Financial Services Authority.

"Northcourt is a timely response to the shortage of capacity in the traditional global nuclear insurance market, for too long dominated by nuclear pools and mutuals," said Rickett in a statement. "Amid burgeoning investment in nuclear energy worldwide there is a growing demand for a new approach to insurance, which is aligned with the global nature of the industry today. There is limited insurer choice for nuclear companies and many have expressed growing concern over the existing market's ability to cope with an increased demand for limits and scope of cover."

Unlike traditional nuclear insurance pools, which are territory-based, Northcourt can place nuclear insurance programs globally through a panel of Lloyd's insurers, according to Northcourt.

Amlin is the lead insurer for Northcourt and has experience underwriting nuclear risk. "As nuclear technologies develop and new markets open across the world, so do the contingent risks of this industry," said Duncan Dale, head of property/casualty for Amlin London, in a statement. "Amlin and the insurer panel seek to enable this development through flexible risk coverage and are pleased to have supported Northcourt in bringing a long-overdue new approach to the market."

More than 60 new nuclear reactors are being built globally, with more than 400 in the pipeline, according to Mark Popplewell, international nuclear practice leader for Marsh.

"Due to the limitations of the existing nuclear insurance arrangements, clients have often in the past struggled to get competitive insurance protection," Popplewell said in a statement. "As the nuclear sector matures and the nuclear renaissance continues to gather momentum, Northcourt offers an exciting source of alternative capital."

Marsh, which had last year identified Asia as an emerging hub for power-related insurance practices, said nuclear power is considered a growth area for insurance markets (Best's News Service, June 14, 2011).

Amlin AG currently has a Best's Financial Strength Rating of A (Excellent).

(By David Pilla, international editor, BestWeek: [email protected])