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The resurgence of nuclear power: Navigating insurance and legal frameworks in a growing industry

Understand how nuclear power’s growth drives new insurance needs, liability laws, and risk management to protect operators and investors worldwide.

20/01/2026 · 6 minute read

Nuclear power is experiencing a remarkable resurgence globally. This is driven by urgent climate goals, energy security concerns, and technological innovation. In this context, industry specialists convened at Marsh’s recent Nuclear Insurance Symposium in London to examine the changing risk environment. Below is a summary of the session focused on the complex legal frameworks governing nuclear liability, presented by Ian Truman, Partner — Nuclear, at Burges Salmon LLP.

What does the nuclear sector cover?

The nuclear sector encompasses far more than energy and defence, which are often the first aspects that come to mind. It also includes:

  • scientific applications;
  • the decommissioning of nuclear sites;
  • nuclear waste management;
  • the production of radiopharmaceuticals for cancer treatment;
  • and novel applications such as nuclear-powered shipping, which are inching closer to reality. 

Nuclear liability

Nuclear energy has risen as a promising source of affordable power. Since this rise there has been a critical need to balance two competing interests. These are: advancing the development and operation of nuclear power plants while protecting people from potential harm in the event of an accident. Nuclear laws have been established to support this balance, forming the foundation of various international nuclear agreements, including:

Revised Paris Convention (2004)

This convention: 

  • establishes liability limits for compensation in the event of nuclear accidents ranging from €70 million to €700 million;
  • extends the scope of the original framework both geographically and in terms of damage types;
  • requires mandatory financial security of participants;
  • sets statutes of limitation of 30 years for personal injury and 10 years for other nuclear damage;
  • prohibits discrimination based on nationality, domicile, or residence;
  • and generally grants jurisdiction to the state where the incident occurs.

The Brussels Supplementary Convention

This provides additional funds to compensate for damage beyond those provided by the Revised Paris Convention. 

The Vienna Convention on Civil Liability (1963) and the 1997 Protocol

These are based on the same international nuclear liability principles as the Revised Paris Convention.

The fundamental principles of nuclear liability include the following:

  1. Absolute liability: The operator cannot face liability for nuclear damage outside the nuclear liability regime.
  2. Exclusive liability: Nuclear liability is “channelled” to the responsible nuclear operator, allowing all insurance capacity to focus on a single point in the supply chain.
  3. Strict liability: A legal term meaning the operator is liable regardless of fault. Even if the operator was not negligent, they remain responsible for any damage caused. While this may seem stringent, it ensures that victims receive compensation without the burden of proving fault.
  4. A limited liability amount: A cap on the operator’s financial responsibility balances this strict liability. This limit protects operators from unlimited exposure, providing a degree of financial certainty.
  5. Liability is subject to time limits. Operators are not liable indefinitely. Statutory limitation periods typically last 10 years for most claims and up to 30 years for personal injury claims. This prevents liability from remaining open-ended.
  6. Mandatory financial security. Operators are legally required to maintain financial security by insurance (or other means) — to cover at least the minimum amount of their liability. This ensures that funds are available to compensate victims promptly.
  7. The principle of non-discrimination. Guarantees that compensation is awarded fairly, without bias based on factors such as the claimant’s residence or domicile.

It is important to note that nuclear liability regimes are only legally binding between countries that are contracting parties to the same international convention.

Operators globally must carefully consider this when transporting nuclear material internationally. They need to understand which, if any, liability rules and limits apply, and ensure their insurance coverage is sufficient to manage these risks. So-called “gap risk” between countries that are not contracting parties to the same international convention has been a significant concern historically. For example, litigation in US courts following a major nuclear incident that is not subject to channelling or a limit of liability, could have potentially catastrophic consequences.

The Convention on Supplementary Compensation for Nuclear Damage

In the UK, the lack of treaty relations with the US, particularly, has made it more difficult, for example, for US nuclear contractors to get involved in the UK nuclear sector. To overcome this, the UK has joined the Convention on Supplementary Compensation for Nuclear Damage (CSC). The CSC is an international treaty that establishes a global liability and compensation framework for nuclear incidents. Serving as an umbrella regime, the CSC covers countries party to the Paris or Vienna Conventions, as well as those with national laws that are compatible with the Convention’s annexe, setting minimum compensation levels backed by public funds.

By signing this treaty, the UK aimed to reduce risk and attract US investment in its nuclear sector, including Sizewell C. The CSC also supports the deployment of small modular reactors (SMRs) by reducing the risk to US vendors of operating in the UK. To incorporate the CSC, the Energy Act 2003 updated the Nuclear Installations Act 1965, effective 1 January 2026.

Emerging legal approaches for fusion energy

While the concept of fusion energy has been around for decades, several projects are seeking to demonstrate it at a commercial scale. On the legal front, efforts are underway to clarify how fusion energy fits within existing liability frameworks. The industry is keen to avoid being classified under traditional nuclear regulations, which involve high costs and stringent requirements. However, the UK and the US have stated that fusion will not be regulated in the same manner as nuclear fission.

Insurance will be needed to back expanding global nuclear ambitions

Many countries worldwide are rapidly increasing their nuclear capacity. For example, Poland is actively developing its nuclear infrastructure while also establishing a strong insurance framework.

In the UK, Great British Energy Nuclear plans to deploy multiple small modular reactors on Anglesey, with ambitions to pursue larger projects in the future. The government has ambitious plans for new nuclear. This includes combining traditional large reactors, SMRs, and advanced nuclear technologies to deliver more flexible and cost-effective energy solutions.

Countries including the US, Canada, Croatia, Finland, France, Ghana, Jamaica, Japan, the Republic of Korea, and Ukraine launched a declaration to triple global nuclear energy capacity by 2050, recognising nuclear power’s vital role in achieving net-zero emissions.

If all these targets and projects are successfully achieved, the resulting major expansion in nuclear development will drive a strong need for greater insurance capacity to underpin the industry.

How Marsh can help?

At Marsh, we understand the unique challenges and opportunities across the evolving nuclear sector — from traditional power plants and small modular reactors to the emerging frontier of fusion energy.

With our extensive expertise in customised insurance solutions, we empower operators, investors, and stakeholders to manage risks confidently while ensuring compliance and resilience across global markets.

For more information on nuclear insurance, please contact your Marsh risk advisor.

Meet the team

Ailish Foster

Senior Vice President, Energy & Power, Marsh Specialty

  • United Kingdom

Simon Harris

Senior Vice President, Energy & Power, Marsh Specialty

  • United Kingdom