2016 National Grid Insurance Update Brochure

Business Overview Safety, Security Revenues Investment Information Summary
and Update and Reliability and Regulation and Innovation and Claims 97


US gas transmission (continued)





US gas transmission leaks eliminated / repaired during 2014


Corrosion Natural Excavation Materials Equipment Other TOTAL
forces & welds operations
0 0 0 0 7 0 7




US gas 7
transmission




Corrosion Natural Excavation Materials Equipment Other
forces & welds operations

Mileage of gas transmission, split by size and regulated entity


Regulated
4" or less 4" to 10" 10" to 20" 20" to 28" over 28" unknown
entity TOTAL % of TOTAL


NIMO 0 10 173 76 9 0 268 56%
KED-NY 0 0 17 29 23 0 69 14%
KED-LI 0 3 86 33 12 0 135 28%
Boston 0 0 6 0 0 0 6 1%
Colonial Cape 0 0 1 0 0 0 1 0%
Colonial Lowell 0 3 4 0 0 0 6 1%
Essex 0 0 0 0 0 0 0 0%
Rhode Island 0 0 0 0 0 0 0 0%
TOTAL 0 16 287 138 44 0 485
% of TOTAL 0% 3% 59% 29% 9% 0%

98 National Grid plc 2016/17 Annual Insurance Update


US gas distribution





Network mileage by age of pipeline


Unknown Pre–1940s 1940–1959 1960–1979 1980–1999 2000–2019 TOTAL





This year 384 6,426 4,800 7,929 8,657 6,764 34,960
Change -8 -197 -77 -76 -16 +513 +139
(last year)






US gas 34,960
distribution




Unknown Pre-1940s 1940–1959 1960–1979 1980–1999 2000–2019



Mileage of gas distribution pipeline, split by type of coating and regulated entity

Unprotected bare (steel) Unprotected coated (steel) Cat protected bare (steel) Cat protected coated (steel) Cast iron
Regulated
entity Plastic Other TOTAL






NIMO 59 172 0 3,528 4,361 523 0 8,643
KED-NY 314 0 0 1,151 1,083 1,586 0 4,134
KED-LI 2,394 747 239 914 3,320 317 0 7,931
Boston 742 447 130 898 2,179 1,946 0 6,342
Colonial Cape 68 29 8 712 1,645 0 0 2,462
Colonial Lowell 22 45 1 565 665 99 0 1,397
Essex 10 10 13 323 427 81 0 864
Rhode Island 296 187 0 595 1,287 806 16 3,187
TOTAL 3,905 1,637 391 8,686 14,967 5,358 16 34,960
% of TOTAL 11% 5% 1% 25% 43% 15% 0%
Change -111 -41 -3 -28 +490 -168 0

Business Overview Safety, Security Revenues Investment Information Summary
and Update and Reliability and Regulation and Innovation and Claims 99


US gas distribution (continued)





US gas distribution leaks eliminated / repaired during 2014


Regulated entity Hazardous Non-Hazardous TOTAL % of TOTAL
NIMO 915 966 1,881 9%
KED-NY 3,915 1,008 4,923 24%
KED-LI 1,455 1,618 3,073 15%
Boston 4,217 3,350 7,567 37%
Colonial Cape 409 101 510 3%
Colonial Lowell 177 102 279 1%
Essex 128 154 282 1%
Rhode Island 1,214 844 2,058 10%
TOTAL 12,430 8,143 20,573
% of TOTAL 60% 40%




NIMO 1,881

KED-NY 4,923

KED-LI 3,073
Boston 7,567

Colonial Cape 510
Colonial Lowell 279

Essex 282
Rhode Island 2,058 Hazardous Non-Hazardous

100 National Grid plc 2016/17 Annual Insurance Update


UK gas transmission









National transmission system (“NTS”)

All 4,737 miles of the NTS pipeline is made up of high grade welded steel, operating at up to 85bar although with
the ability to operate at 94bar in certain areas. The majority of the NTS is laid in rural countryside to reduce risk to
the public and disruption to the pipeline. The balance is laid in suburban areas.



Network mileage by pipeline diameter

Less than 24" 24" to 35" Over 35" TOTAL
854 2,546 1,337 4,737




Local transmission system (“LTS”)
The majority of the 3,096 miles of the LTS pipeline is made up of steel, with a small length being made of
Reinforced Thermoplastic (RTP).



Network mileage by geography




LTS 2,058 miles 416 miles 514 miles 549 miles




East of London London North West West Midlands



Network mileage by operating pressure
Operating pressures between 8.5bar and 75bar – % of LTS network.




LTS 32% 67% 1%





<30 bar 30–70 bar >70 bar

Business Overview Safety, Security Revenues Investment Information Summary
and Update and Reliability and Regulation and Innovation and Claims 101


UK gas distribution









Mileage of gas distribution pipeline, split by geography and pressure

Pressure East of West North West North TOTAL % of
England Midlands London TOTAL
Low Pressure 25,355 12,346 18,310 11,444 67,455 86%
Medium Pressure 5,185 2,122 2,259 1,122 10,688 14%
TOTAL 30,540 14,468 20,569 12,566 78,143
% of TOTAL 39% 19% 26% 16%

* Low Pressure is defined as less than 75mbar.
Medium Pressure is defined as 75mbar to 2bar.

102 National Grid plc 2016/17 Annual Insurance Update


UK gas distribution (continued)





Mileage of gas distribution pipeline, split by type and pressure

Pressure Pit Spun Iron Ductile PE Steel TOTAL
Low Pressure 9,587 6,839 3,632 45,706 1,691 67,455
Medium Pressure 332 600 118 6,898 2,740 10,688
TOTAL 9,919 7,439 3,750 52,604 4,431 78,143
% of TOTAL 13% 10% 5% 67% 5%



Low pressure Medium pressure





Pit


Spun Iron


Ductile


PE


Steel


* Low Pressure is defined as less than 75mbar. Medium Pressure is defined as 75mbar to 2bar.

Business Overview Safety, Security Revenues Investment Information Summary
and Update and Reliability and Regulation and Innovation and Claims 103









Mileage of distribution pipeline, split by type and diameter

Diameter Pit Spun Iron Ductile PE Steel TOTAL % of
TOTAL
4" or less 336 168 10 31,932 920 33,364 43%
4" to 8" 5,968 5,304 2,758 15,552 1,379 30,961 40%
8" to 12" 2,581 1,561 892 3,922 1,447 10,403 13%
Over 12" 1,034 406 91 1,199 685 3,415 4%
TOTAL 9,919 7,439 3,750 52,604 4,431 78,143
% of TOTAL 13% 10% 5% 67% 5%







4" or less 33,364





4" to 8" 30,961




8" to 12" 10,403





Over 12" 3,415
Pit Spun Iron Ductile PE Steel

104 National Grid plc 2016/17 Annual Insurance Update


Liability Claims





In order to provide clarity the individual claims information has been split between the local US liability placement
and the UK/ROW and Global liability placements via National Grid Insurance Company (Isle of Man) Limited (NGICL).

A simplified schematic is shown below for ease of reference.






GLOBAL




$50 million** £25 million**
UK/ROW
US £15 million**
CAPTIVE RETENTION
$3 million Various
BUSINESS UNIT RETENTIONS*
* The self insured retentions vary according to the respective program and in relation to the UK/ROW placement by business unit
** Aggregate limits apply
Please refer to policies for full details.



CASUALTY
NATIONAL GRID INSURANCE COMPANY (ISLE OF MAN) LTD
CONTRIBUTION TO AGGREGATE AS INCURRED
Excluding demerged, sold operations
15

Paid Reserves
12


Total incurred £m 9 6








3



0
1987/88 1988/89 1989/90 1990/91 1991/92 1992/93 1993/94 1994/95 1995/96 1996/97 1997/98 1998/99 1999/00 2000/01 2001/02 2002/03 2003/04 2004/05 2005/06 2006/07 2007/08 2008/09 2009/10 2010/11 2011/12 2012/13 2013/14 2014/15 2015/16


(1) Only includes Excess EL above £2 million each and every claim and £7.5 million in the annual aggregate.
(2) Excess/DIC of Motor third party liability (£50 million tp property damage caused by commercial vehicle, £5 million terrorism and £0.5 million airside liability.
(3) Data 2 December 2015.

Business Overview Safety, Security Revenues Investment Information Summary
and Update and Reliability and Regulation and Innovation and Claims 105


UK/ROW/Global Liability Claims





The following table provides an overview of open and closed claims reported to National Grid Insurance
Company (Isle of Man) Ltd since 1 April 2004 where the incurred loss is greater than or may ultimately be greater
than GBP1 million (Ground up) or includes serious bodily injury. Full details on these claims is provided on our
Renewal Information Website.


UK (GBP) SETTLEMENTS PAID OUTSTANDING OUTSTANDING
TOTAL PAID &
ESTIMATE
RESERVES (GROUND UP)
Claim Loss Date Insured Deductible Insurer Settlement Insurer Outstanding Total Paid & Status
Reserve (excess of Outstanding
Insured deductible) (ground up)
Southall 21-Nov-05 250,000 3,785,647 881,144 4,916,791 Open
Littlebrook 12-Mar-06 250,000 1,868,623 – 2,118,623 Closed
Rawtenstall 22-Dec-08 1,000,000 1,822,876 – 2,822,876 Closed
Shrewsbury 3-Jan-10 250,000 2,564,891 1,747,007 4,561,898 Open
Superstorm Sandy* 29-Oct-12 – 219,950 329,696 549,646 Open

Notes – Any third party recoveries have been deducted from the Insurer Paid amount.
Superstorm Sandy* payments and reserve are for NGICL legal costs only.
All information shown is in GBP million. Conversion rates of 1.63 US$ = 1 GBP and 1 GBP = 1.2 Euro.

106 National Grid plc 2016/17 Annual Insurance Update


NGplc/NGUSA – US Local GL Policy





Large Loss Summary

Losses notified post 2004 where the final loss is either above $1.5 million or anticipated to mature above $1.5 million
(Loss date order).


SETTLEMENTS PAID
Claim Loss Date Insured Insurer Third Party Total Paid by Total Paid by Total Total Paid & Status
Settlement Settlement Settlement Insurers (net of NG & Insurers Outstanding Outstanding
(within deductible) (ground up) Reserve (ground up)
deductible) (ground up)
4206 13th Ave Brooklyn 3-Oct-15 0 0 0 0 0 50,000 0 Open (New)
Mandat 9-Jan-15 0 0 0 0 0 350,000 350,000 Open (New)
Water Mill Explosion 11-Feb-15 0 0 0 0 0 2,000,000 2,000,000 Open (New)
Massachusetts Shade various 0 0 0 0 0 300,000 300,000 Open
Tree Trust
Matos 11-Nov-14 0 0 0 0 0 25,000 25,000 Open
Hansborough Street, 16-Apr-14 0 0 0 0 0 750,000 750,000 Open
Dorchester
Tippin 18-Mar-14 0 0 0 0 0 2,000,000 2,000,000 Open
Caccese 29-Jan-14 0 0 0 0 0 1,500,000 1,500,000 Open
Schuy 1-May-13 0 0 0 0 0 5,000 5,000 Open
Robinson 16-Jan-13 0 0 0 0 0 50,000 50,000 Open
Gazzola (LIPA) 5-Jan-13 0 0 0 0 0 Note 1 Note 1 Open
Chartis a/s/o 30-Oct-12 0 0 0 0 0 2,000,000 2,000,000 Open
Charles White
Super Storm Sandy 29-Oct-12 1,900,000 0 0 0 1,900,000 5,000,000 6,900,000 Open
Paerdegat Basin 27-Sep-12 2,600,000 0 0 0 2,600,000 0 2,600,000 Open
Berganza 19-Sep-12 0 0 0 0 0 0 0 Closed
Green 10-Sep-12 0 0 0 0 0 750,000 750,000 Open
Estrada 29-Jul-12 0 0 0 0 0 1,000,000 1,000,000 Open
Central Islip 10-Jul-12 1,803,000 0 0 0 1,803,000 1,197,000 3,000,000 Open
Lopez (LIPA) 9-Jul-12 0 0 0 0 0 Note 1 Note 1 Open
Panek (LIPA) 9-Feb-12 0 0 0 0 0 Note 1 Note 1 Open
Canales – Hernandez 15-Nov-11 0 0 0 0 0 Note 1 Note 1 Open
(LIPA)
Rodriguez, J 15-Sep-11 50,246 0 0 0 50,246 2,949,754 3,000,000 Open
Gorgone 29-Aug-11 0 0 0 0 0 2,500,000 2,500,000 Open
Jiang & Wang 12-Aug-11 3,000,000 4,100,000 0 4,100,000 7,100,000 0 7,100,000 Closed
Hensley 21-Jul-10 0 0 0 0 0 500,000 500,000 Open
Wrighton 14-Jun-10 0 0 0 0 0 100,000 100,000 Open
Barnett 28-Apr-10 3,000,000 1,100,000 0 1,100,000 4,100,000 0 4,100,000 Closed
Fletcher 18-Mar-10 0 0 0 0 0 1,000,000 1,000,000 Open
Ferrara (LIPA) 16-Mar-10 0 0 0 0 0 Note 1 Note 1 Open
Tush and Scotto 17-Feb-10 0 0 0 0 0 200,000 0 Open
Murphy 8-Oct-09 1,761,270 0 0 0 1,761,270 0 1,761,270 Closed
Davey* 24-Aug-09 0 0 0 0 0 3,000,000 0 Open
Rodriguez, L 29-Jul-09 0 0 0 0 0 1,500,000 1,500,000 Open
Jacaruso 20-Nov-08 0 0 0 0 0 3,000,000 3,000,000 Open
Kotowski 23-Jun-08 0 0 0 0 0 1,000,000 1,000,000 Open
Pattison & Murray 5-Oct-07 3,000,000 5,305,717 0 5,305,717 8,305,717 0 8,305,717 Closed
Giordano 18-Jun-07 1,502,540 0 0 0 1,502,540 0 1,502,540 Closed
Allard 18-Jul-06 3,000,000 6,210,000 3,290,000 6,210,000 9,210,000 0 12,500,000 Closed
McHale 5-Apr-06 2,001,453 0 0 0 2,001,453 0 2,001,453 Closed
Cataldo 14-Mar-06 3,000,000 2,000,000 10,000,000 2,000,000 5,000,000 0 15,000,000 Closed
Giampetruzzi (LIPA) 28-Oct-05 925,000 0 2,325,000 0 925,000 0 3,250,000 Closed
Moran (LIPA) 3-Aug-05 0 0 0 0 0 Note 1 Note 1 Open
North Eastern University 6-Apr-05 3,000,000 3,296,198 0 3,296,198 6,296,198 0 6,296,198 Closed
Habberstad 12-Oct-04 3,000,000 8,600,000 0 8,600,000 11,600,000 0 11,600,000 Open
State Street 11-Jul-00 2,210,000 0 0 0 2,210,000 0 2,210,000 Closed
Campanelli 16-Sep-93 0 0 0 0 0 500,000 500,000 Open
Note 1 – LIPA does not establish reserves on an individual claim basis however the claims are included to reflect that they have the potential to increase due to the nature of the incident.
Management of LIPA claims has now been transferred to LIPA/PSEG LI although the claim will continue to be considered under the National Grid Policy.
Note 2 – Aegis do not currently release their reserve estimates and as such these are not included in the table.
# SuperStormSandy costs are exclusive of legal expenses.
*Davey claim has recently settled – total incurred will amount to circa $6.5 million including defence costs but as this has not been paid to date it is included herewith.

Business Overview Safety, Security Revenues Investment Information Summary
and Update and Reliability and Regulation and Innovation and Claims 107


Property Damage and Business Interruption Claims





PROPERTY DAMAGE / BUSINESS INTERRUPTION / CROSS CLASS
NATIONAL GRID INSURANCE COMPANY (ISLE OF MAN) LTD
CONTRIBUTION TO AGGREGATE AS INCURRED
Excluding demerged, sold operations
40
Paid Reserves
35

30
Total incurred £m 20
25



15

10

5

0
1987/88 1988/89 1989/90 1990/91 1991/92 1992/93 1993/94 1994/95 1995/96 1996/97 1997/98 1998/99 1999/00 2000/01 2001/02 2002/03 2003/04 2004/05 2005/06 2006/07 2007/08 2008/09 2009/10 2010/11 2011/12 2012/13 2013/14 2014/15 2015/16



Since 2013/2014 PA, Travel and EPL no longer contribute to the PDBI aggregate.



PROPERTY DAMAGE / BUSINESS INTERRUPTION / CROSS CLASS
NATIONAL GRID INSURANCE COMPANY (ISLE OF MAN) LTD
CONTRIBUTION TO AGGREGATE AS INCURRED – BY GEOGRAPHY
Excluding demerged, sold operations
40
US UK
35

30
Total incurred £m 20
25



15

10
5

0
1987/88 1988/89 1989/90 1990/91 1991/92 1992/93 1993/94 1994/95 1995/96 1996/97 1997/98 1998/99 1999/00 2000/01 2001/02 2002/03 2003/04 2004/05 2005/06 2006/07 2007/08 2008/09 2009/10 2010/11 2011/12 2012/13 2013/14 Side A Side B Side A Side B


2013/14 – Additional £40 million aggregate applicable for US NatCat. 2014/152015/16
2014/2015 – Side A aggregate is £40 million. Side B underwritten in USD with separate aggregate equivalent to £40 million.
Since 2013/2014 PA, Travel and EPL no longer contribute to the PDBI aggregate.

108 National Grid plc 2016/17 Annual Insurance Update









The following tables provides an overview of all Property Damage and Business
Interruption claims notified to National Grid Insurance Company (Isle of Man) Ltd
since 1 April 2004 with ground up total incurred of greater than GBP1 million.
Full details on these claims is provided on our Renewal Information Website.




UK (GBP)


Insurer
Outstanding
Reserve Total
(excess Outstanding Total Paid
Insured’s Captive Paid Reinsurers of Insured Reserve & Reserved
Claim Loss Date Deductible to Date Paid to Date deductible) (ground up) (Ground Up) Status
Sellindge DCL2 08-Jun-06 2,500,000 1,350,497 - - - 3,850,497 Closed
Castle Donnington 17-Jul-06 200,000 2,007,876 - - - 2,207,876 Closed
Hurst Substation 13-Oct-06 2,300,000 5,652 - - 2,305,652 Closed
Lackenby 13-May-07 2,500,000 2,096,957 - - - 4,596,957 Closed
Substation
UK Floods 25-Jun-07 250,000 3,496,245 - - - 3,746,245 Closed
Wormington 07-Dec-07 10,000 5,866,319 - - - 5,876,319 Closed
Compressor
Willesden 25-Dec-08 5,000,000 3,341,330 - - - 8,341,330 Closed
Substation
Glenmavis LNG
Storage 17-Aug-09 50,000 2,441,567 - - - 2,491,567 Closed
Grain LNG 19-Oct-09 10,000 1,400,063 - - - 1,410,063 Closed
Sellindge DCL3* 30-Sep-12 2,500,000 1,271,876 11,693,762 5,156,238 5,156,238 20,621,876 Open
St Fergus 02-Mar-13 1,000,000 997,276 - - - 1,997,276 Closed
UKET –
Cottingham 26-Apr-13 5,000,000 23,255 - 2,000,000 7,000,000 7,023,255 Open
Substation
Goxhill AGI Tidal
Flood incident 05-Dec-13 1,000,000 - - 1,300,000 2,300,000 2,300,000 Open
Walham 06-Jan-14 5,000,000 16,816 - 3,019,700 8,019,700 8,036,516 Open
Sellindge 11-Nov-15 2,500,000 - - 5,000,000 7,500,000 7,500,000 Open
Notes: Sellindge DCL3* – Total outstanding reserve ground up is all for reinsurers account. All financial information shown is in GBP million.



US (USD)


Insurer
Outstanding
Reserve Total
(excess Outstanding Total Paid
Insured’s Captive Paid Reinsurers of Insured Reserve & Reserved
Claim Loss Date Deductible to Date Paid to Date deductible) (ground up) (Ground Up) Status
Sandy Pond 16-Nov-07 2,000,000 3,255,934 - - - 5,255,934 Closed
Rhode Island 31-Mar-10 1,500,000 4,410,035 - - - 5,910,035 Closed
Floods
Hicksville Fire 27-Oct-10 10,000 3,541,142 - - - 3,551,142 Closed
Tropical Storm 28-Aug-11 1,500,000 6,054,350 - - - 7,554,350 Closed
Irene
Tropical Storm Lee 08-Sep-11 1,500,000 3,527,229 - - - 5,027,229 Closed
SuperStorm 29-Oct-12 7,500,000 57,463,574 124,403,222 73,330,000 73,330,000 262,696,796 Open
Sandy*
Notes: *For Superstorm Sandy the National Grid USA claim is settled and the outstanding reserve is for LIPA. All financial information shown is in USD million.



Confidentiality
All information provided herein is confidential, unless freely available in the public
domain and is provided solely for underwriting purposes. It should not be copied,
reproduced, or published, whether in whole or in part, without the prior consent
of the Group Head of Risk and Insurance, National Grid plc.
Good Faith/Disclaimer
The Insured, and their representatives/agents, have used their best endeavours to
perform a reasonable search of the business to collect, prepare and summarise this
underwriting information. Given the size and expanse of National Grid plc,
the information has been gathered from numerous sources at various times.

It is believed that when taken in its entirety the Information is a fair presentation
of the lnsured’s current activities. (Re)insurers undertake to review this
information, and raise any observations/questions they may have to the broker(s).
Each (re)insurance underwriter is a professional who himself knows his own
information requirements and he alone needs to ensure all such information
requirements have been fully satisfied. The Insured always has and continues
to welcome open dialogue with its (re)insurers.

(Re)insurers acknowledge they have the opportunity to solicit additional information
from the Insured, attend presentations, workshops and surveys chaired by the
Insured. We welcome any questions you have and we will endeavour to provide
answers in an expeditious manner.