A new report recognises there may be a link between electromagnetic fields, areas close to power sources, and childhood leukaemia which has implications for insurance companies providing cover to utility companies.

If electromagnetic frequencies are found to cause illnesses the utility companies could face massive and numerous claims in the future.

There are a number of companies in Bermuda involved in insuring or reinsuring utility companies and some may be more vulnerable than others to large claims through this issue.

Judy Gonsalves, vice president of excess liability at ACE which does provide cover for utility companies, said electromagnetic frequencies -- EMFs -- has been a topic for a while among utility insurers.

"The general feeling at the moment is that the science has moved a lot slower than the legal actions,'' she said.

"It is an issue everybody looks at when underwriting a utility, and in terms of liability cover.'' She said most insurance companies deal with the EMF issue either by excluding it from the cover or increasing the premium. While for commercial reasons she could not say which line Ace has taken, she did say: "At ACE we have taken a position on EMFs and that will not change. This area is a huge minefield, but we will not be taking specific action on this report.'' Ms Gonsalves said the lack of science on the issue so far has meant that lawsuits are not very threatening.

"If a utility company is going to have to pay out, the claimants are going to have to prove the causation in court, and so far they do not have the science to back this up,'' she said.

However this new report claims there may be a link between EMFs and childhood leukaemia. The review was carried out for the UK's National Radiological Protection Board by the the Independent Advisory Group on Non-ionising Radiation chaired by Prof. Sir Richard Doll.

The report concludes: "The possibility remains that intense and prolonged exposures to magnetic fields can increase the risk of leukaemia in children.'' This conclusion represents a change of stance for the NRPB and means underwriters will find it difficult to assess potential exposure.

Another expert in this field is physicist Prof. Denis Henshaw of Bristol University in the UK. He has challenged the research focus on childhood leukaemia, saying there are other more widespread, and potentially more costly, risks.

In his published research he blames power lines for lung cancer, depression, suicides and thousands of illnesses associated with air pollution as well as leukaemia. He claims the mechanism for this lies in the effect of electrically charged pollutant particles settling on skin and lodging in lungs.

In the US there is already a policy of refraining from siting occupied buildings such as homes, schools and offices near power lines. But although a similar policy has been agreed in principle by the European Parliament, it has not yet produced an EU framework directive for individual European states to follow.