Insurers face paying out £1.4bn for a condition that causes no harm, says Dominic Clayden
Though some may accuse insurance companies of being reluctant to pay claims, not even our harshest critic would suggest we pay compensation for something that's harmless.
But this is the very debate we have been having in the High Court this week, when Norwich Union and other defendants addressed the issue of pleural plaques.
Pleural plaques are small discs which grow on the inside of the chest wall. Over time they become calcified. Only recently have we had the medical evidence to demonstrate that this is, in fact, all they do - despite evidence that a person has been exposed to asbestos.
Both claimants and defendants in this case agree that pleural plaques are not a disease of the lung, but are benign and do not cause any symptoms and cannot develop into cancer.
Yet the number of pleural plaques claims has increased by 50% since 1990, with compensation awards increasing by up to 500% in the past 20 years.
This means insurers are paying out provisional damage levels between £3,500 and £7,500 and full and final awards between £12,500 and £17,500. The 2004 Judicial Studies Board guidelines value provisional damages awards up to £25,000.
An asbestos working party study has estimated that the number of pleural plaques claims over the next 35 years could be as high as 104,000, potentially costing £1.4bn.
In tandem, the recent phenomenon of "scan vans" - mobile X-ray or computer scanning facilities often provided by claims lawyers in areas which have suffered asbestos-related illnesses - are not only traumatising the public by bringing undue attention to pleural plaques, but are creating unrealistic expectations of compensation.
For these reasons, it has become necessary to bring test cases to court with the main point being: should an asymptomatic condition attract compensation?
It is not the pleural plaques themselves which increase the risk of developing serious diseases, such as lung cancer or mesothelioma. Rather, it is the history of past exposure to asbestos - signalled by the presence of pleural plaques - which creates the risk.
A high proportion of the population are never aware of their presence, and will never lose a day's quality of life as a result.
Developing an asbestos-related disease could be the subject of a legitimate claim in the future, for which compensation is legally due. The insurance industry has no qualms about dealing with these claims fairly and equitably.
But when it comes to pleural plaques, there are issues that only the intervention of the court can decide. Should there be an injury requiring damages and, if so, how much?
If they don't warrant compensation, should a claimant be awarded damages for an identifiable anxiety or a psychiatric condition caused by the knowledge of having pleural plaques? Is an award of provisional damages justifiable in pleural plaque cases?
Should claims companies have a legal duty of care not to arouse anxiety by encouraging individuals to undergo X-ray examinations to determine the existence of pleural plaques? Could such a company be taken to court for breaching this duty of care?
The current High Court cases are about getting legal clarity on whether pleural plaques should be compensated and, until then, insurers will continue to pay the necessary awards. But if it is decided that a benign condition can attract compensation, we may find ourselves with a very dangerous precedent. IT
' Dominic Clayden is director of technical claims at Norwich Union