The Goodyear Tire & Rubber Company announced that it will receive $22 million in an insurance settlement for asbestos and pollution related claims previously filed by the tiremaker. The $22 million will be paid by Lloyd’s Underwriters reinsured by Equitas Limited in the second quarter of 2005.
Additionally, Equitas will place $39 million into a trust fund that can be used to reimburse Goodyear for costs it incurs in the future to resolve certain asbestos claims. However, if federal asbestos reform legislation is enacted before Jan. 3, 2007, Equitas may have the right to some or all of the funds remaining in the trust. If no legislation is enacted by then, the remaining funds will be paid to Goodyear.
While the specific terms of the April 13, 2005 settlement are confidential, it provides for the payments to Goodyear in exchange for a complete termination of the underwriters’ obligations under their pre-1993 policies.
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