NU Online News Service

WASHINGTON –The Supreme Court’s recent gas emissions ruling in a case between Massachusetts and the Environmental Protection Agency should not open the gates for massive claims that ultimately impact insurers, according to the American Insurance Association.

David Snyder, vice president and general counsel for the AIA, said that the court’s ruling should be seen as more of a mandate to the EPA to make use of its regulatory authority, rather than an opening for states and other municipalities to file suit.

Yesterday one legal analyst, attorney James Davis of the Chicago office of Anderson Kill & Olick, asserted that insurers will be forced to pay huge costs resulting from litigation following the decision permitting states and municipalities to sue companies over greenhouse gas emissions.

“Insurers will pick up much of the tab, pollution exclusions notwithstanding,” he said.

“We don’t accept the premise that the Supreme Court’s decision creates some sort of retroactive liability,” Mr. Snyder said in reaction.

Although he acknowledged that “no one can predict” if suits will be filed and how the lower courts will react to those suits, Mr. Snyder said a scenario such as the one posed by Mr. Davis would be a “very bad outcome” for all involved.

Instead, Mr. Snyder said the AIA believes that the EPA would best fulfill its obligations by working with the affected industries, and specifically the auto industry, to address greenhouse gas emission issues.

The AIA, he said, has supported and continues to support policies that would reduce greenhouse gas pollution, such as funding for public transportation and incentives for consumers to purchase hybrid vehicles.

Whatever the EPA decides to do, Mr. Snyder said that the AIA believes the decision is “purely aimed” at the agency, and that the decision should be interpreted on a “prospective basis.”