The rapid growth of new technologies such as nanotechnology also presents significant challenges to risk managers and (re)insurers. Nanotechnology, the science of manipulating matter at the molecular level, is already being used in numerous consumer and industrial products such as paint, fabric, cosmetics, treated wood, electronics and sunscreen. Its use is also expected to grow in areas such as medicine, pharmaceuticals, pollution clean-up and electronics. Despite the widespread use of nanomaterials in many products today, very little is known about the long-term implications on health or the environment.
The potential risks revolve around the unknown toxicity of nanoparticles as they can be quite reactive. They can also disperse easily in water and air. The particles are difficult to measure due to their small size and their implications on human health are unknown if inhaled, ingested or absorbed through the skin. Moreover, the toxicity levels of nanoparticles are not yet known through each of the stages of their lifetime.
The risks associated with nanotechnology have the potential to create significant challenges for the insurance sector. Potential exposures may impact various lines of business, including general liability, products liability, products recall, workers compensation, directors and officers liability and/or environmental impairment liability. In addition, as with the asbestos crisis, insurers recognize the potential for nanotechnology-related claims to accumulate due to potentially long latent periods of health and environmental impact. Some believe that nano tort claims are inevitable. Should such a scenario come to fruition, (re)insurers face a real challenge in attempting to quantify potential nanotechnology-related losses as the technology is broad and the risk is not uniform.
Insurers have a long history of successfully identifying and managing new and emerging risks. Indeed, several carriers are already endeavoring to enhance their understanding of and mitigate the diverse and complex risks outlined in this report. Considerable investments are necessary to develop a sufficient understanding of new risks as they emerge. However, only by proactively confronting these challenges can carriers establish adequate reserves, pricing levels and further risk awareness. Guy Carpenter and Marsh are actively working with businesses and (re)insurers to develop brokering, analytical and advisory solutions for the challenges new risks bring.