The UK Supreme Court has made a ruling which could allow thousands of compensation claims by families of people who died after exposure to asbestos.
The court has said that insurance liability arises at the time an employee is exposed to asbestos, not when symptoms of asbestosis or mesothelioma appear. It can be decades after the original exposure before such symptoms show up.
The case stems from numbers of claims by families of workers who died many years after they were first exposed to asbestos. The original exposure (and therefore the relevant insurance policy for the defendants involved) dated back to the 1940’s. The High Court decided in 2008 that the right to bring a claim was triggered when the original exposure occurred, but two years later the Court of Appeal said that in some cases liability was triggered when symptoms developed – which could be decades after exposure.
That decision left many claimants facing doubt about whether there was any relevant insurance cover for their asbestos compensation claim. Even if an insurer could be indentified, there was argument over who should pay the compensation- the insurer at the time of exposure to asbestos or the insurer at the time when symptoms first arose. Many insurers from the 1940’s and 1950’s onward no longer existed or argued that a compensation claim did not arise until symptoms appeared. Later insurers argued that they were not liable, because they were not on risk when the original exposure to asbestos occurred.
A group of such insurers had argued that they were not liable to pay asbestos compensation under employers’ liability insurance, if the symptoms of illness arose outside the relevant policy period.
The Supreme Court rejected that argument, deciding that the disease can be said to have been “sustained” by an employee in the period when it was caused or initiated. That means that if an employee is exposed to asbestos, his claim can be directed to the insurer for that period.
Nick Starling, director of general insurance and health at the Association of British Insurers, said:
“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.
Mesothelioma and asbestos-related diseases still causes more than 5,000 deaths every year. The number of people affected by mesothelioma is still rising because of the time it can take for this illness to develop. Figures are likely to peak within the next 3-5 years.