Travelers Property Casualty Corp. has executed a definitive agreement settling asbestos-related statutory-based direct actions pending against Travelers under various unfair trade practices acts and similar statutes, including the Wise, Meninger and Cashman purported class actions and similar cases.
The settlement in principle was previously announced on Nov. 21, 2003. The settlement will make available a fund of up to $375 million to claimants plus up to $37.5 million in legal fees.
As previously announced, Travelers will fund this settlement from its unallocated asbestos reserves, which were $1.2 billion at Dec. 31, 2003, and will not take an earnings charge in connection with this settlement. The settlement is conditioned upon a number of contingencies, including execution of a definitive settlement agreement relating to similar lawsuits filed in Hawaii (the settlement amount of which is included in the settlement amounts above). It is also conditioned on entry of final orders by the court approving these settlements and barring all future asbestos-related statutory direct actions against Travelers in West Virginia, Massachusetts, Hawaii and other states in which, Travelers believes, plaintiffs may argue that similar claims are recognized by state law.
The agreement requires that all claimants who receive compensation from the fund provide a general release of Travelers for all direct action claims they might have against Travelers relating to asbestos.
“I am pleased with the progress we have made over the past year in reducing our overall exposure to asbestos-related claims,” said Chairman and Chief Executive Officer Robert Lipp. “This settlement is a reflection of our aggressive approach to resolving these claims and offers a unique opportunity for Travelers to resolve early all asbestos-related statutory direct actions that have been brought against Travelers.”
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