ABSTRACT

Figure 16.4 Insurers, experts and laypeople’s perceptions about the risk posed by nanomaterials to society over the next 15 years in the following areas: medicine, computing, energy applications, cosmetics, clothing, and food sectors. 16.5 Discussion and ConclusionSome claim that nanotechnology is the driving force behind a new industrial revolution. However, in reality, nano-developments outside of nanomedicine and nanoelectronics are progressing in the backdrop of what many refer to as “nanopotential” (Bawa,

2015). Insurers’ perceptions of nanotechnology and nanomaterials should be taken into account in order to assure the sustainable development of the technology. Insurance does not only compensate for losses, but it can also incentivise nanotech companies to engage in more responsible practices in the production and use of nanomaterials. The qualitative and quantitative data presented in this chapter indicate that insurers are familiar with nanotechnology and nanomaterials terms. Moreover, although insurers are more aware of the technology than the laypeople, this familiarity is still at a basic level. Given the fact that the insurance industry is one of the main bearers of the potential nanotechnology and nanomaterials risks, this suggests a need for more information transfer and exchange between the different stakeholders such as nanoscientists, regulators, nanotech companies and insurers themselves. This in turn could inspire the insurance market to move beyond the “wait and see” approach and encourage the adoption of different strategies to manage potential risks arising from nanomaterials production and use. For example, Mullins et al. (2013) propose a control banding (CB) approach that can be used by underwriters to assess the relative level of nanomaterials production risk. It can also form the basis for an underwriting decision-making process. Better risk communication and collaboration between the insurance market, nanoscientists, regulators as well as nanotech companies could also lead to the introduction of new insurance products. This, in turn, would directly contribute to the sustainability of nanotechnology and nanomaterials development and use.The vast majority of the insurers surveyed said that they considered the benefits of nanotechnology to outweigh the risks. However, this optimistic view is in part due to the fact that there have been no reported major adverse events involving nanotechnology and/or nanomaterials to date. The insurance industry has a tendency to base their underwriting decisions on past experiences (i.e., claims history) rather than hypothetical future scenarios. The perceptions of insurers could shift towards a much more cautious approach in response to new information or due to a loss of a larger scale caused by nanomaterials production

and/or use. This was the case with the terrorism risk which was generally included under open peril property insurance policies. However, after 9/11, most insurers excluded terrorism risk from their insurance policies, as it was perceived to be too large and unpredictable, which in turn made the risk temporarily uninsurable in the U.S. market. To avoid a situation where nanotechnology risks become uninsurable, the insurance market has to actively engage in risk communication with other main stakeholders in the field, as well as to adopt a number of precautionary risk management strategies. This is needed in order to manage the impact of possible adverse events that could threaten the ability of the nanotechnology sector to procure insurance, which ultimately could threaten the sustainability of nanotechnology development and use. Corresponding AuthorDr. Martin MullinsDepartment of Accounting and FinanceKemmy Business School University of Limerick, Limerick, IrelandEmail: martin.mullins@ul.ie Disclosures and Conflict of InterestThe authors declare that no writing assistance was utilized in the production of this chapter and the authors have received no payment for its preparation. The research discussed herein has received funding from the European Community’s Seventh Framework Programme FP7 under grant agreement N° 280716, Sanowork (www.sanowork.eu). The authors declare that they have no conflict of interest and have no affiliations or financial involvement with any organization or entity discussed in this chapter. This chapter is based on the authors previous paper that appeared in the newsletter, Risk Management, No 54, 2014. The views expressed here are solely those of the authors in their private capacities and they do not in any way represent the views of Liberty Syndicate Markets, UK, the European Commission, or the University of Lemerick, Ireland.