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Japan Insurers Said Not To Renew Contract For Fukushima Nuclear Plant

Japan Insurers Said Not To Renew Contract For Fukushima Nuclear Plant
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Δευ, 28 Νοεμβρίου 2011 - 18:42
A consortium of 23 Japanese property and casualty insurers has told Tokyo Electric Power Co. (9501.TO) that it will not renew insurance expiring Jan. 15 on the utility's Fukushima Daiichi nuclear plant, source of the nation's worst-ever nuclear accident, sources close to the matter said Monday, the Kyodo news service reported.
A consortium of 23 Japanese property and casualty insurers has told Tokyo Electric Power Co. (9501.TO) that it will not renew insurance expiring Jan. 15 on the utility's Fukushima Daiichi nuclear plant, source of the nation's worst-ever nuclear accident, sources close to the matter said Monday, the Kyodo news service reported.

The damaged nuclear plant is expected to face far greater risks than other nuclear plants during planned post-accident damage control and decommissioning, they said, Kyodo reported.

Under the law, the government insures nuclear plants against accidents caused by natural disasters such as earthquakes and tsunami waves, and private-sector insurers cover other accidents. As the Fukushima accident caused by the March disaster was subject to government insurance, TEPCO has received Y120 billion in insurance money from the government.

Private-sector insurers are reluctant to renew coverage for the Fukushima plant as possible future accidents -- for example during fuel rod extraction and other operations -- are likely to become subject to private-sector insurance, the sources said, Kyodo reported.

Foreign insurers' reluctance to provide reinsurance for the Fukushima plant might have also discouraged Japanese property and casualty insurers from renewing the contract, they said.

Cancellation of coverage presents a new problem for TEPCO since nuclear plants are required by law to be coverage by private-sector insurance. Without it, such future work as extracting nuclear fuel rods from the damaged reactors could be deemed illegal, Kyodo reported.

To avert that possibility, TEPCO is considering depositing up to Y120 billion -- the limit of insurance coverage for a nuclear plant -- with the government, the sources said.

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