New judgement says insurance liability begins at time of first exposure to asbestos… A recent ruling by the UK Supreme Court could lead to a large number of insurance claims from the families of victims of asbestos-related illnesses.
The ruling is important because it states that insurance liability occurs at the time of the exposure to the asbestos rather than when symptoms first appear. In many cases the symptoms of asbestos do not appear for 10 or even 20 years. Indeed the families of those people who have died from the asbestos-related cancer mesothelioma are intending making claims on policies dating as far back as the 1940s.
The Supreme Court had to rule on the issue only after the lower courts failed to produce a judgement. Initially in the High Court in 2008 had agreed that companies were liable from the time their employees inhaled the asbestos fibres but the Court of Appeal muddied the waters two years later when they announced that in some cases liability only begun after the symptoms developed. The ambiguity was finally done away with when the ruling panel of five Supreme Court judges stated that the disease could be described as being “sustained” when the employee was first exposed to it.
Lord Clarke, one of the five judges explained:
“The negligent exposure of an employee to asbestos during the [insurance] policy period has a sufficient causal link with subsequently arising mesothelioma to trigger the insurer’s obligation.”
Nick Starling, a director at the Association of British Insurers, said:
“The ABI and our members are committed to paying compensation as quickly as possible to people with mesothelioma who have been exposed to asbestos in the workplace.
“We have always opposed the attempt to change the basis on which mesothelioma claims should be paid, as argued by those who brought this litigation.
“Today’s ruling by the Supreme Court has confirmed what most in the industry have always understood – that the insurer on cover when the claimant was exposed to asbestos should pay the claim, rather than the insurer on cover when the mesothelioma develops.
“This case has been pursued by a small group of ‘run-off’ insurers acting independently and at odds with the views of the majority of the UK insurance industry.”
(A “run-off” company is an insurance firm which is no longer taking on new clients)
Helen Ashton, a lawyer representing the lead claimant, Ruth Durham, was pleased with the judgement as it provided “clarity, consistency and comfort” for the families of thousands of mesothelioma victims.
She added “This judgment means that the thousands of people who are yet to be given the devastating news that they have the deadly illness will at least know that their families can get access to justice and receive the financial security they need.
“But the sad fact is that many victims of mesothelioma who have been awaiting the outcome of this appeal may not have lived long enough to know if their families will now receive the compensation they deserve.”
Asbestos-related diseases are estimated to cause more than 5,000 deaths every year and is considered to be the single biggest cause of work-related deaths in the UK.
The number of people affected by mesothelioma continues to rise due to the time it can take for this illness to develop with the number of sufferers expected to peak in 2015.