Nanotechnology will drive risk revolution

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Corporate clients should share their 'secrets' with insurers to help the development of more robust ...

Corporate clients should share their 'secrets' with insurers to help the development of more robust risk management systems in order to deal with the unknown risks of nanotechnology, according to a major global insurer.

"Nanotechnology will be the driving force of a new industrial revolution," said David Hall, director of client management and broker relations at Allianz Global Risks UK. "We need to work in partnership with clients in risk management processes to help support their business going forward, as well as maintaining the sustainability of the insurance industry."

He continued: "We are focusing on a client intimacy strategy. If clients tell us their corporate secrets, if they can trust and share those innovations with us on a confidential basis, we can create risk management tools to support their business."

In a move to raise awareness about the issue, the Allianz Group has published Size Matters: A Report on Nanotechnology - The Risks and Opportunities, a joint study with the Organisation for Economic Co-operation and Development's International Future Programme.

The rate of products for sale worldwide that have some input from nanotechnologies is set to jump from 0.1% to 15% in 2014. Experts predict that nanotechnologies will be used in almost all major industries, such as food, medicine, agriculture, electronics, textile, construction, pharmaceutical and energy.

Although such rapid growth is seen as a good opportunity for new developments and for the insurance industry, the reality is that the risks are yet to be fully understood. The impact of exposure to nanotechnologies on humans and the environment may not be evident until many years later, which could have dire consequences for insurers.

"There are a variety of nanotechnologies and different ways in which they can be used. And there is a gap between the scope for innovative uses for nanotechnology and the corresponding understanding of the consequent risks to humans and the environment," Mr Hall said.

He added that the way forward was not by creating a general exclusion for nanotechnologies but by forging solutions that are suitable for policyholders and insurers alike.

THE REPORT'S RECOMMENDATIONS

- Independent research into the risk of nanoparticles, exposure routes and their effects on humans and the environment.

- Strengthening of the evidence base regarding the safe handling of nanoparticles.

- Development of comparative risk classification schemes and databases.

- Focus on attention by underwriters and risk managers on the critical issues.

- Bringing the discussion of nanotechnology to the forefront of insurance.

- Fostering a dialogue-orientated approach among all stakeholders.

- Developing a suitable regulatory framework in which to enable the industry to operate sustainably and safely.

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