U.K. Supreme Court Says Insurers Should Pay Asbestos Victims

Thousands of workers who fell ill from exposure to asbestos can receive compensation after the U.K. Supreme Court ruled insurers should cover their claims.

The judges decided that employers’ liability insurance was triggered the moment workers came into contact with hazardous material, rather than years later at the onset of mesothelioma, a cancer caused by asbestos inhalation.

“It would be remarkable if the insurers were not liable under the policies,” said Justice Jonathan Mance, one of five Supreme Court judges who dismissed the insurers’ appeal.

Companies including Akzo Nobel NV (AKZO) and Amec Plc (AMEC) and a group of local governments and individual claimants have been trying since at least 2006 to force four insurers, some of which are insolvent, to pay compensation on claims arising from the point at which workers inhaled the asbestos fibers.

“The result will be a relief to thousands of disease victims and their families,” whose insurance claims have been on hold because of the litigation, said Leon Taylor, a lawyer at DLA Piper LLP (1191L) who represented two insurers, BAI (Run Off) Ltd. and Independent Insurance Company Ltd. Both companies are insolvent and being wound down by PricewaterhouseCoopers LLP.

“For the insolvent insurance companies involved, their administrators and liquidators now have the judicial guidance they needed to satisfy their obligations,” Taylor said in an e- mailed statement.

Mesothelioma is a lung disease which kills about 3,000 people every year in the U.K. due to the common use of asbestos materials as recently as the 1970s.

To contact the reporter on this story: Kit Chellel in London at cchellel@bloomberg.net

To contact the editor responsible for this story: Anthony Aarons at aaarons@bloomberg.net