ML20042C489
| ML20042C489 | |
| Person / Time | |
|---|---|
| Site: | Shoreham File:Long Island Lighting Company icon.png |
| Issue date: | 03/18/1982 |
| From: | James Smith LONG ISLAND LIGHTING CO. |
| To: | Dinitz I Office of Nuclear Reactor Regulation |
| References | |
| SNRC-683, NUDOCS 8203310446 | |
| Download: ML20042C489 (6) | |
Text
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LONG ISLAND LIGHTING COM PANY 4fdIdf4DP F SHOREHAM NUCLEAR POWER STATION fwamfafm.
P.O. DOX 618, NORTH COUNTRY ROAD + WADING RIVER, N.Y.11792
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March 18, 1982 SNRC-683 g)
O Mr. Ira Dinitz a
Office of Antitrust & Indemnity RECEIVED 3
U.S.
Nuclear Regulatory Commission g
Washington, D.
C.
20555 5
MAR 301982m-I f Nuclear Liability Insurance
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- "m'"an m Shoreham Nuclear Power Station - Unit 1 HK Docket Nos. 70-2884 (and 50-322)
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Reference:
(1)
Letter SNRC-322 dated 9/25/78, Application for License to Receive, Possess, and Store Unirradiated Fuel Assemblics (2)
Letter SNRC-6C7 dated 2/9/82, Damestic Licensing of Special Nuclear Material -
10CFR Part 70 License s
Dear Mr. Dinitz:
Long Island Lighting Company has obtained a standby Nuclear Liability Insurance (Facility Form) Policy, NF-269, to provide financial protection as required prior to receiving a license for fuel storage.
Enclosed herewith are eight certified copies (2 originals and 6 copies) of the NF-269 Policy Declarations of the Nuclear Energy Liability Insurance Association, which provide confirmation that the Facility Form coverage is in force.
This information is hereby being filed with the. Commission in accordance with 10 CFR 140.13 and 140.15 as required prior to NRC issuance of a Part 70 license and associated indemnity agreement, which are anticipated in the very near future.
Refer to references (1) and (2) for information relative to the Part 70 license, rM I/
8203310446 820318 PDR ADOCK 05000322 J
PDR FC 8935
s March 18, 1982 SNRC-683-Page 2 Should you have any questions or require additional information, please contact this office.
Very truly yours, m
.b J.
L. Smith Manager, Special Projects Shoreham Nuclear Power Station RWG:mp Enclosure-cc:.
N. Ketzlach - NRC (NMSS)
J.
Higgins I
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NUCLEAR ENERGY LIABILITY INSURANCE ASSOCIATION 4
127 John Street, New York, New York 10038 NucIcar Energy Liability Policy No. NF 269 (Facility Form)
DECt.ARATIONS tiem i. Named Insu,ed Long Island Lighting Company 250 Old Country Road, Minneola, New York 11501 3aa,,,,
(No.
Street Town or City State) 10th a, or February i, 82.nd cont;nuios through Item 2. Policy Period: Beginning at 12:01 A.M. on the the edettive date of the cancelation or termination of this policy. standard time at the address of the named insured as stated herein.
Item). Dexciption of the Facility:
All of the premises including the land and all buildings and structures w,,;oo of Lono Island Lichtino Company's Shoreham Nuclear Power Station, comprising approximately 880 acres located on the north shore of Long Island,.just north of Brookhaven National Laboratory and approximately three (3) miles from the community of Rocky Point. The site is located in the Town of Brookhaven, Suffolk County, New York Power Reactor 7,p, Long Island Lighting Company The of critor of the failier i, 1.000,000.00
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Incm 4. The limit of the compar.ics* liability is $
100.00 stem 3. Ad.ance Premium s a pagt he col give a complete dewription of the fuilatr. insofst as it relates to the nuclest Item 6. These declarations and the whedule o energy hasard.except as noted Y
19 Counte. signed by Date of Isive This is to certify that this is a true copy of the original Declaration $"'*""'8 "'P""'"'
- nd Endorsements Numbered 1 through 5 and being made a part of the N le:r Energy Liability Policy (Facility orm) as designated hereon.
N In ura e is orded
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Secnnd Revision)
Jo i L. Quattrocc 1, V ce resident-ility Underwriting American Nuc1 car Insurers
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O NUCLZAR ENERGY LIABILITY FACILITY FOR'1 CCVEPAGE 4
The Pacility Form policy protects against third party bodily injury or property da:aage cauned by the nuclear ene rgy hacard, which is defined as the " radioactive, toxic, explosive or other hazardous properties of nucle ar material. " The coverage is provided to satis fy the finan cial protection requirement of the federal Price-7nderson Act.
A power reactor must satisfy this requirement before receiving a fuel storage or operating license from the Nuclear Regulatory Commission.
Current maximum limits under the Facility Form coverage are $160 million, and are provided by two nuclear insurance pools - American Nuclear Insurers (ANI) and Mutual Atomic Energy Liability Underwriters (MAELU). An impor-tant feature of the Facility Form policy is its omnibus definition of insured, which includes any party other than the federal government as an insure d.
SECONDARY FINANCIAL PROTECTION COVERAGE Secondary Financial Protection, as the term implies, is also a requirement of the price-Anderson Act.
The coverage operates as a post-loss assess-ment: each operating power reator in the U.S. may be assessed up to SS million per accident, or $10 million per year. This assessment would apply only after exhaustion of the primary Facility Form capacity.
As part of this coverage, ANI and MAELU provide a $30 million contingent-liability program, which would respond if a utility were to default on all or part of its assessment.
Contingent coverage is provided under
- s. master policy similar t a performance bond, and a reactor comes under the program when its operating license is issued.
NUCLEAR ENERGY LIABILITY SUPPLIER' S & TRANSPORTER' S COVERAGE The Supplier's and Transporter's (S&T) policy, unlike the Facility Form and post-loss assessment, is not mandated by Price-Anderson and thus -
needn't be purchased by a nuclear' utility.
But many utilities purchase S&T coverage to protect against exposures that are not covered under their financial protection programs.
The most common exposure involves the shipment of nuclear waste from the reactor facility to an offsite location. - Coverage during transportation is afforded under the reactor's Facility Form policy.
But 'once the material arrives at its destination, the Facility Form no longer applies.
A S&T policy issued to the reactor utility would apply, however,. and for the same third-party bodily injury or property damage resulting from the nuclear energy hazard.
Current maximum S&T policy limits are also $160 million, and are again provided by ANI and MAELU.
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e 4 e PRIMARY PROPERTY DAMAGE COVERAGE The property damage coverage insures the reactor plant itself.
Unlike the nuclear liability cove rage, the property damage policy is all-risk, and protects against both the normal property perils and radioactive contamination of the plant.
AMI and MAELU provide this coverage up to current limits of S450 million.
The full coverage, including contamination,normally is purchased when nuclear fuel arrives on site.
Prior to that time the utility insures its facility throdgh standard builder's risk property damage coverage.
The limit to be purchased is at the utilities discretion, because pro-tection of the facility itself does not fall within the purview of the Price-Anderson Act.
EXCESS PROPERTY DAMAGE COVERAGE Because of the very high insurable values at risk at reactor facilities, and particularly because of severe potential losses resulting from nuclear contamination of the facility, many utilities have concluded that the primary property damage capacity is not af forded.
As a result, an excess property damage layer has been made available by Nuclear Electric Insurance Limited (NEIL), a Bermuda-based mutual insurance company.
The NEIL program will ultimately provide $500 million excess of $500 million. The NEIL policy insures against the same perils covered under the primary policy, but there is one important difference. Each NEIL insured is liable to be assessed up to 7.5 times annual premium in the event of loss.
This feature is referred to as a Retrospective Premium Adj ustment, and would only apply if existing premiums and loss reserves were exhausted.
The NEIL program currently han $244 million in capacity.
REPLACEMENT POWER EXTRA EXPENSE COVERAGE NEIL also provides an extra expense coverage for member utilities with operating reactor facilities. This program, which is completely separate from the Excess Property Damage Program, provides weekly indemnity insurance for the extra expense of replacement power costs due to extended outtages -
caused by accidental damage to the insured property. The maximum recovery for single unit sites, following a 26-week deductible period, is S2.3 million per week for the first 52 weeks, and $1.15 million per week for the second 52 weeks, equal to a total liability limit of $179.4 million per single unit for each insured accident.
Like the Excess Property Damage Program, the extra expense coverage includes a Retrospective Premium Adjustment.
Each insured is liable to be assessed up to five times annual premium in the event of loss.
Again, the assess-ment only applies if existing premiums and loss reserves are exhausted.
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LONG ISLAMD LIG11TIIIG COMPANY S!!OREHAM NUCLEAR POWER STATION SUM:1ARY OF NUCLEAR INSURANCE ESTIMATES 1982-1984 1982 1983 19 84 Facility Form Coverage S22,115
$436,259 S638,625 Secondary Finanical Protection 1,5 12 6,000 6,000 S&T Coverage 15,458 26,055 27,925 Property Damage Cove rage 2,068,969 5,051,866 5,101,682 NEIL I 1,265,984 1,510,000 NEIL II 336,378 1,280,676 1,348,744
$2,444,432 S8,066,840 $8,632,976 e