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PROPERTY & CASUALTY
MAR 07, 2018
Nanotechnology – What is it and How Will it Affect the Insurance Industry?
Something small is in the process of having a big impact on the manufacturing and insurance industries. Nanotechnology is being positioned as the key technology of the 21
century and the driving force behind a new industrial revolution. Sounds great, right? But what is it?
Nanotechnology means the science, engineering and technology conducted at a nanoscale – about one to 100 nanometers. This is considered technology at an atomic level. To put it in perspective, there are 25.4 billion nanometers in one inch. If you were unsure what nanotechnology was before this article, you’re not alone. A reported 42.7 percent of laypeople have no idea what nanotechnology is.
Source: Insurance Market Perception of Nanotechnology and Nanomaterials Risks
Believe it or not, we’re already using nanotechnology on a daily basis. It’s found in a wide range of industry and household products including: medicine, electronics, sunblock, toothpaste, cosmetics, food and much more. Nanoparticles are used to add zinc oxide to make clothing that protects people from UV radiation. The Consumers Products Inventory lists over 1,600 products identified as having nanoparticles. That’s a significant increase from the mere 54 products in 2005.
The national and global markets for nanotechnology are growing significantly. BCC Research has found that on a global level, nanotechnology products were valued at about $26 billion in 2014 and are expected to reach about $64.2 billion by 2019. In a 2012 study by McDermott, Will and Emery, the U.S. has been leading the global market, accounting for 54 percent of the nanotechnology patent applications and grants, followed by Asia at 24 percent. In the U.S., California has the most nanotechnology companies, followed by Massachusetts, New York, Texas and Michigan.
Source: Munich RE
As with most new technologies, nanotechnology comes with both benefits and possible risks. A study by Gen RE found that the growing nanotechnology industry could be the most important – yet ignored – emerging issue for property and casualty insurers. It could potentially have an impact on general, product and environmental liability insurance, as well as product recalls and workers’ compensation.
Health and environmental issues should be determined before manufacturers take the sizable plunge into nanotechnology. Health risks could involve both workers and consumers. Employees working with nanoparticles in a free form state could risk being adversely exposed. Environmental issues include waste material and industrial emissions during the production stage or at the end of the product’s life, when it could end up in a landfill.
Federal agencies such as the Occupational Safety and Health Administration (OSHA), the National Institute for Occupational Safety and Health (NIOSH), the Environmental Protection Agency (EPA) and the Food and Drug Administration (FDA) have already weighed in on the potential worker and consumer risks of nanotechnology. In fact, the FDA has stated that it will evaluate nanomaterials on a case by case basis and that additional industry guidance will be developed as needed. But the agency states it hasn’t yet made a “categorical judgment that nanotechnology is inherently safe or harmful.”
The future of nanotechnology
As the aforementioned statistics show, the nanotechnology industry is here to stay – and growing exponentially. If your business utilizes nanotechnology in production, take the necessary measures to keep your workers and the environment protected. You’ll also want to let your insurer know your level of nanotechnology usage to keep your company protected as well. Amerisure will be closely observing the developing nanotechnology industry, and we suggest that employers do the same.