As companies use nanotechnology to develop products like self-cleaning windows and transparent sunscreens, how will the insurance industry underwrite these risks? Christoph Meili, senior lecturer at the University of St.Gallen explains.

By Christoph Meili

Nanomaterials are commonly used in many industrial and consumer products, and while they can help create innovative products, they also pose substantial risks to human health and the environment. Self-cleaning windows, scratch-resistant colors and lacquers, transparent sunscreens, antimicrobial plastering as well as packaging materials or textiles are examples of nano products available on the market. And that list of industrial and consumer products is growing.

In Germany for example, there are approximately 2,000 companies and research organizations related to nanotechnology. Most of them (44 percent) are small and medium-sized enterprises, 41 percent are research organizations and university labs and 15 percent are large companies. In 2011 there were 64,000 workers in the nanotechnology field.

Due to the cross-sectional character of nanotechnologies the sales volumes of nanomaterials and nanoproducts are increasing in all industries. In the color and lacquer industry for instance, it is expected that by 2020, 20 percent of the total business sales will be generated by nano-components (for example smart coatings), as the antimicrobial and scratch-resistant ingredients. The situation in other industries is similar. According to international forecasts, nanotechnologies will be a key factor in the value creation of goods, with a market value of up to $3 trillion by 2015. Their market potential in 2015 could correspond to approximately 15 percent of the industrial goods market. A large part of the global goods production, for example in the areas of health, information and communication technology, energy and environmental technology would be based on the application of nanotechnology knowledge.

Assessing the Nano Risk Profile

Nanomaterials have often been critically discussed in the past few years with regard to their potential adverse effects on human health and the environment. Even though scientific risk research on nanomaterials has been ongoing for more than 10 years, it is still premature to determine potential adverse effects on human health and the environment in the mid- and long-term perspective.

In addition to physical and chemical data, exposure data is needed to address human and eco-toxicological effects. Nanomaterials which are bound or embedded in a solid matrix pose low or even no risk, according to many experts. By contrast, unbound, powdered or airborne particles could be inhaled and enter the bloodstream through the lungs. In the bloodstream, particles can enter cells. Some nano particles have actually been found in the nucleus and interacting with cellular structures. Carbon nanotubes (CNT), which are long, fiber-shaped nano molecules have been found to cause inflammation and asbestos-cancer-like malignant tumors in mice.

Nanoparticles can also enter the body through digestion. However, there is few data on the behavior of nanomaterials in the intestinal tract that demonstrate that titaniumdioxide nanoparticles (which are commonly used in food) cause inflammatory reactions and have genotoxic effects in cells of in the intestine, according to a study by Heinrich Heine Universitt in Germany. In the environment there are persistent and bioactive nanomaterials which are critically examined. Today, no final judgment of the potential risks of specific nanomaterials in the middle or longterm perspective is possible. A "long-tail" risk potential for certain nanomaterials, however, cannot be excluded.

Potential Loss Exposure for Liability Insurances

See the rest here:

The Risky Future of Nanotechnology