Property Casualty Insurers Association of America (PCI), an industry organization comprised of more than 1,000 insurance companies, says it opposes S. 852, the Fairness in Asbestos Injury Resolution (FAIR) Act, calling the legislation “well intentioned” but representing “a potential public policy disaster.”
“Resolving our nation’s asbestos crisis should be one of Congress’ top priorities,” said PCI President and CEO, Ernie Csiszar. “For too long, the legitimate victims of asbestos exposure have faced a clogged and inefficient claims process in their efforts to be compensated for their losses, while many businesses have faced insolvency from the costs of frivolous and unfounded asbestos claims.”
But Csiszar said that the current legislation has been “cobbled together in an effort to satisfy all political factions, without due diligence given to the effects the bill will have on asbestos victims, employers, insurers, and our nation’s economy.”
According to PCI, S. 852 lacks two key provisions that are needed to resolve the asbestos litigation crisis.
“There is no certainty that the contributions made to the fund by insurers and businesses will be enough to cover all valid asbestos claims,” said Csiszar. “The potential costs of the bill lie not just in the $46 billion insurers will be responsible for providing to the trust fund, but in the countless billions in legal costs insurers will spend on cases that the trust fund does not cover.
“Moreover, the legislation requires insurers to contribute a disproportionately large share of the trust fund’s start-up costs, with a very high likelihood that the fund would fail in its early years. This large up front contribution places the insurance industry in a potentially disastrous and unfair situation if the fund fails for any reason in its early years. Insurers will have contributed significant payments, only to find themselves back in the tort system. In essence, insurers will be paying twice for these claims–once under the trust fund and once under the tort system. S. 852 potentially creates a dual track system for asbestos claims, the trust fund and the tort system.”
Source: Property Casualty Insurers Association of America
Topics Carriers Legislation Politics
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