U.K. Asbestos Claims Could Top $36 Billion

A new study of asbestos related diseases in the U.K., as reported by the BBC, indicates that total claims could reach £20 billion ($36 billion) over the next 30 years.

According to actuarial estimates, about half that cost could be born by the insurance industry. The National Health Service would then be responsible for the rest of the costs. The research, the first of its kind in the U.K., was based on new data collected by the group from major British insurers. The BBC quoted Julian Lowe, who led the study, as indicating, “asbestos is certainly not yesterday’s problem. Its effects will continue to affect insurance companies and healthcare providers in the West for years to come.”

While the amount is considerably less than U.S. estimates, which indicate that the ultimate industry payout could be as high as $200 billion over the next 20 years, they are still substantial.

Although use of the material has largely been discontinued throughout in Western countries, its effects on those who worked in industries such as construction, mining, shipbuilding and the manufacturing of products containing asbestos, continue to be felt, as the various diseases associated with the fibers manifest themselves. The incidence of disease can continue for up to 40 years. Claims in the U.K. are expected to peak in about 10 years time, the study indicated, costing between £8 billion ($14.5 billion) and £20 billion $36.5 billion) in coming years.

According to the study one type of disease, asbestosis, will decline over the period. However, it indicated that “more than half of the claims are expected to come from people with mesothelioma – a terminal and incurable asbestos-related disease.” The government’s exposure stems from the fact that employers’ liability insurance was only made compulsory in 1972, so any claims relating to firms before that date may not be covered, or may even involve firms which are no longer in existence.

“People will have to claim against the companies, if they still exist. The problem is of course that, 30 or 40 years down the line, it’s very tricky to find companies that might have gone out of business,” Mr Lowe told BBC Radio Five Live.

A government compensation scheme is available for asbestos victims who cannot trace their previous employer. Meanwhile, the study warned that insurers need to be putting enough money aside to pay for any future claims.

Lowe also noted that asbestos use, while virtually non-existent in the West, has actually been increasing in Russia and in Asia, leading to potentially disastrous health problems related to it in the developing world over the next 40 to 50 years. “More asbestos is used now in Asia than was used in America at its peak,” Lowe told the BBC. “Take China for example, a huge amount of construction and they’re using most of the asbestos in the world – more than America ever did.”