General Insurance Article - Ruxley research shows US APH claims are to hit Euro insurers

 In the third of its pioneering research publications on US APH, Ruxley has uncovered a dramatic turnaround in US APH claims over the last year. Mesothelioma claims awards have soared - in a single Californian case in June, an 86 year old victim was awarded an astonishing $48 million. Worryingly, new sources of claims also continue to be identified, such as claims made by children exposed to asbestos taken home from work.

 The impact of rising claims awards and an upswing in claims notifications has resulted in US insurers being forced to increase their reserves for US APH liabilities. AIG has had to increase its reserves by 75%.

 Ruxley’s conclusion last year, that European insurers are not actively engaged in managing their US APH liabilities, has continued to hold true in the last 12 months as their US APH reserves have shown no significant movement. However with the surprise increase in claims awards and Solvency II just over the horizon, European insurers need to focus their attention on these old liabilities that once again should be high on management agendas.

 John Winter, CEO of Ruxley Ventures comments: “With claim settlement award levels soaring and claims arising from new, unexpected sources, these are uncertain times for holders of US APH. Perhaps we always knew the long-term impacts of exposure to asbestos would not go away easily, but at a time when pollution liabilities have stabilised, we could not have expected that a single individual suffering from mesothelioma would be awarded $48 million in damages.

 “With Solvency II about to compound the US APH claims hike, European insurers need to reconsider their stance and take action to deal with the problem before the costs begin to impact the industry’s profitability.”