What the form is
The EP 01 21 Nuclear Energy Liability Exclusion Endorsement (Broad Form) is a mandatory endorsement used with Employment-Related Practices Liability (ERPL) insurance policies. Its primary purpose is to explicitly exclude coverage for any liability, loss, cost, or expense arising directly or indirectly from nuclear reactions, radiation, or radioactive contamination, regardless of any other contributing cause or event. This exclusion is broad and applies whether the nuclear material is used for peaceful or warlike purposes.
Classes of business it applies to
This endorsement applies to virtually all classes of business that carry an Employment-Related Practices Liability policy where the insurer utilizes ISO (Insurance Services Office) forms or similar policy language. Since nuclear-related risks are typically covered under specialized government-mandated insurance pools (like the Price-Anderson Act in the U.S.), this endorsement ensures that standard liability policies, including ERPL, do not duplicate or inadvertently pick up these catastrophic exposures. For example, a manufacturing company, a healthcare facility, or a retail business with an ERPL policy would all typically have this exclusion attached.
Special considerations
It's crucial to understand that this is a standard and generally non-negotiable exclusion in the vast majority of liability insurance policies. The breadth of the exclusion means that any claim even remotely connected to a nuclear incident, as defined in the policy, would likely be denied under the ERPL coverage. For instance, if an employee alleged wrongful termination due to whistleblowing about safety violations at a nuclear facility, while the employment practice itself might be a covered peril, if the underlying damages were deemed to arise from the nuclear hazard, this exclusion could be invoked. However, the primary intent is to exclude large-scale nuclear incidents.
Key information for agents and underwriters
For Agents: Agents should ensure clients understand that this is a standard exclusion and that coverage for nuclear perils requires specialized insurance. It's important to manage client expectations regarding the scope of their ERPL coverage in relation to nuclear risks. While employment-related claims are the focus of ERPL, this endorsement carves out any nuclear-related aspect of such claims.
For Underwriters: This is a mandatory endorsement for ERPL policies to maintain consistency with overall liability underwriting principles and to prevent exposure to catastrophic nuclear-related losses. Underwriters should verify its attachment to all ERPL policies. The presence of this endorsement helps ensure that the insurer is not unintentionally covering risks that are meant to be handled by specific nuclear insurance mechanisms. There is generally no separate premium consideration for this exclusion as it's a fundamental part of defining the scope of coverage.