• The AEC was anxious to encourage the use of nuclear energy for generating electricity. • The cost of electrical energy from light water reactors used in base load service was significantly lower than the energy derived from fossil fuels. * In 1955, the AEC requested the private insurance industry to study the problems involved in insuring private companies against reactor risks. In 1957, four private insurance pools were formed; NELIA and MAELU provided liability insurance in amounts up to $46.5 and $13.5 million per incident, respectively. These policies cover third party liability but do not cover damage to the on-site property of the insured; damage to the property of the insured is covered through joint policies from NEPIA and MAERP. The Price-Anderson Act was passed in 1957, The Price Anderson Act essentially limited the required utility insurance coverage for each accident to the level at which insurance coverage was privately available; all other insurance coverage (up to $500 million per incident) was to be purchased from the government. Liabilities over the limits set by the Price Anderson Act were to be disallowed. It appears that the question was not how much of a liability would the utilities accept but how much of a liability would an insurance company or consortium of insurance companies accept and for what price? The answer in 1957 was $60 million per incident. The cost of this insurance was to depend upon the specific reactor type, its use, its rated thermal output, the degree of containment, the location of the facility, the population density of the environment, etc. The desirability of special legislation to address those issues for the SPS which were addressed by the Price Anderson Act for the lightwater reactor, might be addressed in future studies. J.F. Hogerton, Arthur D. Little, Inc., The Atomic Energy Deskbook, Reinhold Publishing Corporation, New York, 1963.
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