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UK Actuaries revise asbestos predictions

Mesothelioma liabilities comprise the overwhelming bulk of all future asbestos liabilities.


A summary of the main findings of the Insurance Actuarial Working Group on asbestos was published in December 2020 with the full report promised to follow “early in 2021”.

The 2021 GIRO paper now published provides a comprehensive analysis of the modelling used, alongside a detailed résumé of the rationale adopted, in revising downwards the 2009 predictions of future financial liability cost of £11 billion to 2050 (scenario 23).

The main findings

  • Asbestos liabilities have incurred costs of £3.4 billion between 2009 and 2019.
  • Modelling of future liabilities has been undertaken on a number of scenarios. These range in financial terms from £3.5 billion to £12.1 billion, but overall a “central scenario” is adopted suggesting a figure of £4.9 billion in respect of future liabilities, covering the years 2020 to 2060.
  • Adding incurred costs to estimated future liabilities, (central scenario), suggests a combined figure of £8.3 billion, even if taken 10 years further than the 2009 paper, which estimated future cost at £11 billion. The estimated cost of future mesothelioma claims has been reduced by broadly 40% from the 2009 estimate. Non-mesothelioma claims cost is reduced by less than 3%, with increased projected costs for both pleural thickening and pleural plaques largely offsetting the reduction in lung cancer claims.

Reasons for the revised predictions

The reasons are essentially threefold:

  1. Firstly, the 2009 paper, written as it was shortly after the implementation of the NHS National Mesothelioma
    Framework, assumed a rising propensity of sufferers to claim. Propensity to claim has been static rather than increasing. The actuaries also point to a reduced propensity by age to claim, evidenced by CRU data.
  2. Secondly, the “run off” in the tail has occurred faster than estimated with overall mesothelioma claims falling each year since 2015.
  3. Thirdly, the average cost of a mesothelioma claim and in particular, court inflation, has not risen as sharply as predicted in 2009.


Mesothelioma liabilities comprise the overwhelming bulk of all future asbestos liabilities. By adopting the updated parameters set by the HSE, to include an earlier latency cap and the removal of the allowance for background claims, combined with a static, not rising propensity to claim and lower than predicted court inflation, have all informed a substantial downwards revision in future mesothelioma costs and in turn, total asbestos liabilities.

The estimates make no allowance for either COVID-19 or for the costs associated with immunotherapy. In respect of the latter, the authors felt that the data suggested this formed only a small part of average costs. In respect of COVID, the authors felt the likely percentage impact was small but recognised that ‘an increased share of the sufferer and potential sufferer population will die of COVID-19 rather than of asbestos disease’.

The estimates in respect of non-mesothelioma claims cost are largely unchanged from the position in 2009, despite predicted future lung cancer costs being substantially lower than estimated in 2009. Here the increased costs associated with pleural plaques claims in Scotland and Northern Ireland, alongside a greater number of pleural thickening claims than originally estimated are responsible for the status quo.

It is of note that in the underlying data provided by compensators, the total of non -mesothelioma claims themselves peaked as far back as 2013 at 2,134 claims. Pleural plaques (compensable only in Scotland and Northern Ireland) peaked in 2017 at 325 claims.

This underlying data showing a consistent decline in new mesothelioma claims year on year, alongside HSE data showing a decline in mesothelioma mortality, ought to reassure compensators that the peak has been reached and both the actual and predicted acceleration of “run off” will incur lower future financial cost.

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