Tiny substances called nanomaterials have moved into the marketplace over the last decade, in products as varied as cosmetics, clothing and paint. Nanoscale forms of substances like silver, carbon, zinc and aluminum have many useful properties. Nano zinc oxide sunscreen goes on smoothly, for example, and nano carbon is lighter and stronger than its everyday or “bulk” form. It is predicted that the market for nanomaterials will grow to $3 trillion by 2015. But researchers say these products and others can also be ingested, inhaled or possibly absorbed through the skin. And they can seep into the environment during manufacturing or disposal.

One of the risk factors of nanomaterials is their minute size. Nanomaterials are engineered on the scale of a billionth of a meter, perhaps one ten-thousandth the width of a human hair, or less. Because nanomaterials are so small and nearly impossible to detect, the effects on the environment and public health is largely unknown. Additionally, the uses of nanomaterials are relatively new so the long term effects are unknown.

Because the effects of nanomaterials on the environment and public health are unknown, extensive research is needed to study the issue. More importantly, however, is the risk to the industries that use nanomaterials in the production of goods and the insurance companies who insure those companies. Nanotorts have the potential to be the asbestos or tobacco litigation of the 21st century.

The insurance industry will be greatly affected by the proliferation of nanomaterials and the subsequent nanotorts sure to follow. Because the effects of nanomaterials on the environment and public health are largely unknown, insurance companies will not be able to fully evaluate the risk of insuring companies that manufacture nanomaterials or products that utilize nanomaterials. Insurance companies can be certain of one fact, the plaintiff’s bar is sure to be closely following the scientific research being conducted in the area of nanomaterials for any evidence that nanomaterials present either a danger to the environment or public health; they will even be looking for any data which suggests there may be an increased risk of harm to pursue claims in jurisdictions which don’t require actual damage to pursue a claim.

The insurance industry will need to be fully aware of the scientific and legal repercussions of insuring companies that manufacture or utilize nanomaterials as nanotorts are the next big area of class actions and personal injury litigation.

Currently, the main issue regarding the use of nanomaterials is research. The National Research Council recently issued a report sponsored by U.S. EPA, which calls for a new research strategy that is independent of any stakeholder group. The strategy, the panel wrote, should focus on human health primarily by building on past efforts. It should be broken up into four focus areas: identifying nanomaterials being released and who is affected by them; understanding processes that affect both potential hazards and exposure; examining how nanomaterials interact with ecosystems; and supporting research on the materials.

The report comes on the heels of an EPA inspector general report that said the agency lacks an effective program to collect information and assess health risks posed by nanomaterials. The panel also said that any reduction in the current $120-million-per-year funding level for nanomaterial research would be a step in the wrong direction. Further, it called for "additional modest resources" from public, private and international sources.

As more research is conducted into nanomaterials and more nanomaterials are utilized in the manufacturing of everyday products, government regulations and lawsuits will follow. The insurance industry needs to be ahead of the curve and determine whether their existing policies would cover such litigations or whether special policies and riders are necessary to handle the risk.

There is a blog dedicated to nanotorts located at