Jimmy Keime, Head Engineering & Nuclear at Swiss Re, stated that nuclear investments are growing globally, with rising demand for nuclear energy to power data centres — creating both opportunities and risks for the insurance and reinsurance industry.
He continued, “We’re seeing major technology firms contracting nuclear energy to secure the energy sources for the data centres, including investments in small modular reactors (SMRs).
“Regarding data centres, today we estimate that approximately 15% of the energy is coming from nuclear energy, and this is going to grow. Not immediately, because those take time to build, especially the small modular reactors, but if we look at between 2030 and 2040 this number is likely to grow maybe between 15–20%.”
Keime highlighted that this trend creates both opportunities and responsibilities for the re/insurance industry.
“So, opportunities for the industry itself: nuclear is stable, low carbon power source, and it’s needed to electrify the economy.
“In terms of responsibilities, it carries unique risks. We’re seeing these across construction, operations, liability, waste management, and public perception. It requires a really selective approach when we look at nuclear risks, we need strong technical expertise to really understand the underlying technology. We use a lot of risk modelling in that space as well. And then it’s a long term engagement from regulators and operators on that segment of the industry,” said Keime.
He further outlined where re/insurers are currently involved and where challenges lie: “So, first, construction. This is fully taken by the private insurance and reinsurance industry, usually for the construction of nuclear power plants.
“And then, operation. This is the space of the nuclear pools, where the private industry plays a role in supporting those pools. But it’s true that those pools have limited capacity and limited limits, and then it goes back to the States.”
He highlighted that for SMRs, it is still unclear how the industry will organise itself to insure this new risk.
“There is no product existing yet for the transportation of the small modular reactors. There is no product yet that looks at the different liabilities topics between the constructor, the transporter, the land owner, and then the operator. For big plants, it’s very easy, usually it’s the same, but for the small modular reactor, we’re looking at a new space where no product exists yet. So, we’re working on this. We’re looking at this to see if potentially, some of those liability limits that could be potentially lower could be taken by the private industry, or if it needs to continue to be taken by the pool, or combination of both. There is no answer yet to that question,” said Keime.
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