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New asbestos report released

The Actuarial Profession’s UK Asbestos Working Party has updated its estimate of the future cost of UK asbestos-related claims to the insurance industry. This follows its research which identified that the proportion of people suffering from mesothelioma that subsequently make a claim for compensation has almost doubled between 2004 and 2008.

The findings of the working party include:

  • The total undiscounted cost of UK asbestos-related claims to the insurance market could be around £11bn for the period 2009 to 2050. Of this figure, 90% relates to mesothelioma and over £9bn relates to the period 2009 to 2040, which compares to the working party’s 2004 estimate for the same period of £4.7bn
  • The proportion of mesothelioma sufferers that have made a claim for compensation has increased from around one-third in 2004 to nearly two-thirds more recently. This change, which was not expected in 2004, but has become evident in recent years, explains most of the increase in total costs.
  • The working party has taken into account the Health and Safety Executive’s statisticians’ revised projections of the number of future deaths from mesothelioma in Great Britain, released in 2009, in conjunction with other projection models. 

Speaking on behalf of the working party, its Chairman, Brian Gravelsons said: “Insurers will of course have already noticed the increased number of claims from mesothelioma sufferers, so these developments won’t be a surprise to them. However, the working party’s projections will provide the insurance industry with a consistent reference point to help it assess its asbestos liabilities.”

“There is still considerable uncertainty surrounding the future cost of asbestos claims, as the number of people that will be diagnosed with mesothelioma many years into the future cannot be accurately predicted. The working party will continue to monitor the emerging experience and update its projections accordingly.”

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Enquiries: Tel. Michael Scanlan on 020 7632 1453 / 07798 804 871 or email michael.scanlan@actuaries.org.uk

Notes to Editors

  1. The UK Asbestos Working Party is an actuarial body which researches the key drivers of asbestos-related claims. The current 18 members include actuaries from insurance companies, reinsurance companies and consultancies.
  2. A copy of the report can be found here, and the spreadsheet models here.
  3. Actuaries provide commercial, financial and prudential advice on the management of a business assets and liabilities, especially where long term management and planning are critical to the success of any business venture. They also advise individuals, and advise on social and public interest issues.
  4. Members of the Profession have a statutory role in the supervision of pension funds and life insurance companies. They also have a statutory role to provide actuarial opinions for managing agents at Lloyds.
  5. The Profession is governed jointly by the Faculty of Actuaries in Edinburgh and the Institute of Actuaries in London. A rigorous examination system is supported by a programme of continuing professional development and a professional code of conduct supports high standards reflecting the significant role of the Profession in society.
  6. The Profession is available to provide expert comment to the media on a range of actuarial- related issues, including enterprise risk management, finance and investment, general insurance, health and care, life assurance, mortality, and pensions.