While U.S. asbestos-related incurred losses dropped in 2016, property/casualty insurers’ payments for asbestos claims grew 9 percent and hit $3.2 billion for the year, a new A.M. Best report concludes.
The $3.2 billion figure exceeds the long-term average of $2.4 billion, A.M. Best said. But there was a 24 percent year-over-year drop in incurred asbestos losses, which propelled an overall 17 percent decline in asbestos and environmental incurred losses in 2016.
A.M. Best said its estimate for net asbestos losses for the U.S. P/C insurance industry remains at $100 billion, with net environmental losses staying at $42 billion, as of year-end 2016.
Other findings from the A.M. Best report:
- As of year-end 2016, the P/C industry funded slightly less than 90 percent of its aggregate asbestos and environmental exposures. That translates into $13 billion in unfunded liabilities for asbestos and $1 billion for environmental.
- From 2012 to 2016, the P/C industry paid out $17.6 billion in losses for asbestos and environmental claims but incurred $13.6 billion in losses.
- Industry funding of net asbestos and environmental exposures of $142 billion reached about $127 billion. That breaks down by $102 billion in cumulative paid-to-date losses and $25 billion in reserves set aside for future payments.
The full report: “Asbestos Losses Continue to Rise; Environmental Losses Remain Stable.”
Source: A.M. Best
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