A surge in asbestos-related claims over the coming decades could land British insurers and employers with a bill of up to £20bn, according to research by actuaries published yesterday.
The study nails the myth that asbestos is "yesterday's problem" with its prediction that as many as 200,000 new insurance claims from British workers who were exposed to the deadly mineral are expected over the next 30 years or so.
It claims there is a risk of Britain mirroring the US, which has in recent years seen an explosion in claims from people who are not sick but are worried they could become ill - bankrupting several large American firms in the process.
The study is based on data collected by the Actuarial Profession from all major UK insurance companies.
Asbestos was widely used as an insulating material during the 60s and 70s but medical studies later established it can cause cancer and other respiratory diseases if inhaled.
The researchers point to a likely increase in mesothelioma claims over the next few years. Mesothelioma, a relatively rare form of cancer, is probably the most serious asbestos-related disease. It is usually fatal within two years of diagnosis, can develop as a result of very low asbestos exposure and symptoms may not appear for 40 or 50 years.
UK health and safety regulations regarding asbestos have been tightened considerably over the last 30 years, but Britain will be living with the consequences of its use for decades to come.
The study - which focuses on British firms and workers rather than UK companies' exposure to overseas claims - estimated the total future bill at between £8bn and £20bn. British insurers which covered the health of firms' employees are likely to face half of this cost.
The rising bill will also put pressure on local authorities which have employed staff who worked with asbestos, companies which manufactured and installed the heat-proof material, and the state compensation schemes that exist for people whose employers have gone bankrupt or cannot be traced.
US engineering group Federal-Mogul - parent company of Turner & Newall, the British firm at the centre of a pensions dispute - sought Chapter 11 bankruptcy protection after a huge increase in asbestos claims in America.
Asbestos has been described as the biggest occupational health risk faced by workers in Britain. At least 3,500 people died in 2002-03 as a result of exposure to asbestos fibres, with the annual number of deaths expected to peak at 4,000 to 5,000 between 2011 and 2015.
Mesothelioma claims are expected to continue to rise over the next decade, while claims for other asbestos-related diseases such as asbestosis are set to fall, according to the study. The average mesothelioma claim is about £100,000.
Julian Lowe, who chaired the working party which carried out the research, said it had been concerned to see a marked increase recently in the number of UK asbestos-related claims where the claimant was not ill.
"In America, claims for so-called 'unimpaired lives' - for the worry of potentially catching an asbestos-related disease - now form around three-quarters of all asbestos-related US claims," he said. "It is highly undesirable for the UK to go down this route, which diverts resources from claimants with real and serious injuries."
While the manufacture and use of asbestos has fallen in western Europe and North America in recent decades, it has continued to expand in Asia and parts of eastern Europe. The study said urgent action was needed by the international community to help these countries deal with the inevitable "appalling" consequences of this activity.
