Property Casualty Insurers Association of America (PCI) President and CEO, Ernie Csiszar, released the following statement regarding the U.S. Senate’s consideration of S. 852, the Fairness in Asbestos Injury Resolution (FAIR) Act.
“Resolving our nation’s asbestos crisis should be one of Congress’ top
priorities,” Csiszar said. “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.
“S. 852, while well intentioned, represents a potential public policy disaster. The 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.
“S. 852 lacks the two key provisions – certainty and finality – 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. 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.
“PCI has worked diligently over the past three years with the Senate Judiciary Committee and others in the Senate to find solutions to compensate the victims of asbestos in a fair and efficient manner. However, when S. 852 emerged from the Committee last year, it became clear that it will do little to solve our nation’s growing asbestos litigation crisis.
“I strongly urge the members of the U.S. Senate to oppose this legislation and to continue work on amendments that would repair the leaks in this bill, ensure that all legitimate asbestos claims are settled fairly, and provide businesses and insurers the certainty of a single process for resolving such claims,” Csiszar concluded.
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