RAND Sees Asbestos Claims Rising

A leading think tank has found that themore than 500,000 asbestos injury plaintiffs with $21 billion inclaims in the United States may be only the tip of the iceberg.Indeed, it is possible that less than half of all potentialasbestos claims have been presented to date, the RAND Institute forCivil Justice says.

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The Santa Monica, Calif.-based groups findings were disclosed ina recent report, “Asbestos Litigation in the U.S.: A New Look at anOld Issue.”

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RAND found that annual asbestos claims filings as a whole havebeen rising “sharply” since 1990, and acknowledged that “no oneknows the total amount spent to date to resolve asbestosclaims.”

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Examining asbestos-related bankruptcies, the RAND report foundthe number has soared in the past 18 months. At least 41 asbestosdefendant corporations have filed for bankruptcy, with eight ofthese filing since Jan. 1, 2000.

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Additionally, the report found that asbestos litigation isspreading across industries. Early claims generally targetedcompanies that mined asbestos or manufactured, distributed orinstalled asbestos insulation and other products. Defendants nowinclude building-product manufacturers and distributors,construction contractors, auto parts makers, retailers, insurersand others.

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According to the report, “there is reason to believe thatnon-traditional defendants are paying an increasing share of thecosts to resolve asbestos injury claims.” In addition, with so manycompanies going bankrupt, some plaintiffs' attorneys reported theyare seeking more money from non-bankrupt defendants.

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Although the RAND report could not predict whether the trend ofsharp rises in claims filed will continue, it nevertheless foundthe recent changes in filing rates has influenced expectations ofthe parties, attorneys and business analysts.

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The RAND report concluded that:

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The fair and efficient resolution of asbestos claims remains “asignificant policy question.”

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All of the major asbestos defendants will likely be inbankruptcy within 24 months.

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Current bankruptcies present an opportunity to review andrethink strategies for resolving the claims.

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The full text of the RAND report is available atwww.rand.org.


Reproduced from National Underwriter Property &Casualty/Risk & Benefits Management Edition, September 10,2001. Copyright 2001 by The National Underwriter Company in theserial publication. All rights reserved.Copyright in this articleas an independent work may be held by the author.


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