Chaucer not expecting major losses relevant to Nuclear Syndicate 1176

Lloyd's insurer Chaucer this morning confirmed its exposure to nuclear power plants in Japan, but said losses would be limited.

Chaucer moved to clarify the position of its specialist Nuclear Syndicate 1176 after the Japanese earthquake and resulting tsunami last week damaged nuclear plants, causing a number of explosions.

In a statement, Chaucer said: "The board of Chaucer would like to take this opportunity to express its profound sympathy to all those affected by this tragedy.

"Chaucer confirms that its specialist Nuclear Syndicate 1176 is one of a panel of insurers that provide coverage to Tokyo Electric Power Company, the owner of two of the three nuclear sites in the proximity of the affected area - Fukushima Dai-ichi and Fukushima Daini.

"The company would like to clarify that it has no coverage in place for property damage or business interruption at these two plants.

At the third plant, Onagawa, owned by Tohuku Electric Power Company, coverage for property damage is provided, but the perils of earthquake and tsunami are specifically excluded."

Under the Japanese Nuclear Act of 1961 (and amended in 2009) the operators are not liable for any damage arising from a "grave natural disaster of an exceptional nature", Chaucer said.

"Consequently, Chaucer does not expect any significant insured loss to arise in respect of this event insofar as it is relevant to Syndicate 1176," the insurer added.

"The company will provide estimates of its other exposures to the event as soon as the size of the loss and, importantly, the size of the insured loss with regard to Chaucer has become clearer."

Meanwhile, Chaucer also confirmed that talks with a number of interested parties relating to a possible offer for the company are ongoing.

"A further update will be provided in due course, if appropriate," it said.