Asbestos – the unquenchable liability risk

Asbestos – the unquenchable liability risk

Asbestos, magic mineral and hidden killer, was a 20th century nightmare right? Wrong. Asbestos is the “complete” carcinogen that just keeps on giving. A fascinating and comprehensive new book by Barbara Hadley and Tom Rennell (Asbestos: The Future Risk) reveals how asbestos is still killing workers and crippling insurance companies into the 21st century. And will continue to do so.

It’s estimated in the book that some 100,000 people die every year as a direct result of exposure to asbestos, roughly 275 every day, and this figure continues to rise.

The prevalent use of asbestos during the 20th century means that vast quantities remain hidden in buildings and structures across the developed world. In the UK alone, the Health & Safety Executive (HSE) estimates some half a million commercial and public buildings still contain the hazardous mineral and, as schools and hospitals are refurbished for instance, it is once again being released into the workplace.

More worrying still, the book’s authors point out that industry in the developing world continues to produce and consume vast quantities of asbestos every year. At its height, asbestos consumption reached 4.8 million tonnes a year; today annual global consumption still tops over two million tonnes. This, at a time when the health risks associated with asbestos are well known.

Historically, Europe and North America were the world’s leading consumers of asbestos but by the early 1990s consumption in the western world fell away as the deadly effects of asbestos became known and bans were put in place. Today India and China account for more than half of the world’s consumption and Asia as a whole for over 70 per cent. While demand elsewhere is dropping, asbestos consumption is continuing to increase in China, India and Indonesia, driven largely by demand for asbestos-cement building products.

World Bank research cited by the authors states: “From the industrial hygiene viewpoint, asbestos creates a chain of exposure from the time it is mined until it returns to the earth at the landfill or an unauthorised disposal site. At each link in the chain, occupational and community exposures co-exist.” So it’s not surprising that asbestos related diseases are found in populations from miners to nurses. At some point, it seems, all of us can come into contact with the deadly material.

Many countries are seeing increases in cases from groups of people outside the traditional high risk sectors. In Australia, for example, a recent government report has predicted a “third-wave” of asbestos-related diseases with an estimated 30,000-40,000 Australians being diagnosed in the next 20 years, many of whom have been exposed from routine DIY home improvement projects, for example.

Eighteen months after the 2011 Fukushima earthquake and subsequent tsunami, Japanese authorities found that 14 tested areas recorded levels of asbestos far in excess of the WHO safety level of 10 parts per litre. The highest level recorded, in the rubble of a hotel in Sendai, was 785.5 parts per litre.

Hadley and Rennell’s book is a clear-eyed social document that will fascinate a broad spectrum of readers from laymen to industrial archaeologists. Its contextual examination of the issues around the different asbestos related diseases, plus regulation and litigation in different countries, is thoroughly researched and well presented.

Inevitably, insurers and reinsurers will be tempted to cut straight the section on trends in claims and compensation.

That’s because many property and casualty insurance companies are still dealing with legacy losses from asbestos in the US and in Europe, even though any policies issued since 1985 exclude coverage. Until recently it had generally been assumed that asbestos claims in the US had reached their peak and ought to be tapering off.

That prediction has turned out to be somewhat optimistic, as the authors point out, with high court pay-outs, increased medical knowledge, new sources of claims and increased global activity by personal injury lawyers tending to favour the plaintiff and with no legislative relief on asbestos liability in sight.

As a result, US insurers are finding it increasingly difficult to gauge what the ultimate cost of their asbestos claims could be. In 2009, AM Best raised its estimate of future industry asbestos liabilities to $75bn from $65bn, noting that “the industry is about 4% underfunded for the $75bn in liabilities it faces”. At the end of 2012 the agency added a further $10bn to the estimate making it $85bn.

A recent study concluded, “Given the long latency period between exposure to asbestos and the manifestation of mesothelioma, as well as the very large number of people exposed over a great many years, both directly and indirectly, it is likely that asbestos losses will continue to develop for many years to come.”

Asbestos: The Future Risk, 156pp, Iskaboo Publishing, .
£120/$200/€150 (inc P&P). To order contact Barbara Hadley:

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October 2018


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