Government announces plans for insurance tracking in asbestos related cases

One of the features of asbestos-related diseases is their long latency period.  This is the time it takes between someone being exposed to asbestos dust and an asbestos condition developing, explains Michael Osborne, senior solicitor with Moore Blatch Resolve. 

It is exceptional that the latency period is less than twelve years, and there is no upper time limit:  cases of fifty years between exposure to asbestos dust and diagnosis of an asbestos disease are not unheard of.  Most of the claims which we and other solicitors are handling today result from exposure to asbestos between the 1950s and 1970s.

All too commonly, a solicitor cannot pursue a claim for compensation because, by the time that an asbestos condition is diagnosed, the victim’s employer has gone out of business and the relevant insurers cannot be traced because records have been lost or destroyed.

The Association of British Insurers (ABI) has since 1999 operated a voluntary scheme which tries to trace employer’s liability (EL) insurers.  The scheme is, however, widely regarded as unsatisfactory: in 2008 3,210 people who used the scheme (about 40% of enquirers) were unable to trace an insurance policy, which meant they were left without compensation. 

It is welcome news, then, that the Department for Work and Pensions (DWP) announced in February 2010 that it intends to set up an Employers’ Liability Tracing Office (ELTO).  This will manage the existing ABI scheme and set up a central electronic database of EL insurance policies.  It will become a regulatory requirement that insurers record details of their new EL policies on the database. 

The DWP has set up a consultation process and invited interested parties for their comments on how the ELTO should operate and on how it should be funded.

As part of the same consultation, the DWP is considering setting up an Employers’ Liability Insurance Bureau, which would act as a fund of last resort for victims of asbestos-related diseases who cannot trace the insurer of the employer they were working for when they were exposed to asbestos.

The consultation period ends on 5 May 2010.

For more information, please contact Michael Osborne on 020 8332 8636 [Richmond] or 023 8071 8092 [Southampton] or email michael.osborne@mooreblatch.com