Insurers Still Hoping For Asbestos Reform

Capitol Hill, he said, will have to make the call. Senate Majority Leader Bill Frist, R-Tenn., and Minority Leader Tom Daschle, D-S.D., are expected to meet to decide where to go next.

The field, Mr. Karr said, is wide open. The Senate could try a new proposal or attempt to redraft the trust fund idea.

For the insurance industry, he said, the important thing is to get real reform enacted into law.

"This crisis is not going away," Mr. Karr said.

Anne Sittmann, a representative of the Des Plaines, Ill.-based Property Casualty Insurers Association of America, adds that the insurance industry remains unified and is committed to finding a solution that will provide certainty, finality, affordability, effectiveness and efficiency.

In a statement on the floor of the Senate, Sen. Frist said that while all the parties to the negotiations?insurers, defendants and organized labor?negotiated in good faith and made progress, there were gaps in claims values, projections and the amount of dollars needed to establish a trust.

But he said efforts at finding a solution will continue.

"We are committed to working together to determine whether a compromise can be reached that would provide sufficient payments to asbestos victims and certainty to companies," Sen. Frist said.

Meanwhile AIA President Robert E. Vagley said that insurers remain staunch, vigorous supporters of meaningful asbestos litigation reform at the earliest opportunity.

"We urge Congress now to consider alternatives to the current trust fund approach and to redouble efforts to enact legislation that protects the real medical victims of asbestos and the economy at large," Mr. Vagley said.

Marliss Browder, director of federal affairs for the Indianapolis-based National Association of Mutual Insurance Companies, said that NAMIC believes Congress must address the current asbestos litigation crisis, and that NAMIC remains committed to working with Congress to develop meaningful reform.

Regarding the trust fund approach in S. 2290, Ms. Browder said that all parties, including insurers, labor and defendants, have conducted intense good faith negotiations and made significant progress.

"But unfortunately," she said, "we seem to be far from reaching a solution."

Mr. Vagley said it is now clear that a workable trust fund that establishes an efficient exclusive remedy for victims, as well as equity, certainty and finality for all stakeholders is politically unattainable.

Moreover, Mr. Vagley said, it will become even less economically viable over time as more and more of the finite resources available to compensate the true victims of asbestos are siphoned off by the "out-of-control litigation system."

Carl Parks, senior vice president of federal government affairs with PCI, said that his members are "deeply disappointed" that negotiations on S. 2290 have been suspended, given that asbestos litigation has reached crisis proportions in the United States.

"It is imperative that members of Congress reach agreement on a compromise that appropriately compensates ill victims while reducing transaction costs and providing absolute finality for defendants," he said.

He agreed that the trust fund approach may not be politically feasible at this time.