In the Fairchild, Fox and Matthews mesothelioma cases last December, the Appeal Court ruled that compensation would not be payable where, as in these cases, employment spanned several different employers and no one employer could be proved to be liable.


The judge called this "a major injustice crying out to be righted". Soon after this judgement, the Association of British Insurers (ABI) initiated an extensive set of discussions to consider the implications of the case.

But recent events have led to confusion among stakeholders and the media. Following the decision of the House of Lords last week to hear the cases on 7 May, some points, at least, should be clear.

In recent weeks, the insurance companies involved in these cases made a genuine attempt to reach a settlement by offering to pay claims and legal costs in full. They felt this was the right thing to do, particularly since further litigation will delay payment and provides no guarantees. It is unfortunate that this offer was rejected.

More than that, the ABI's employers' liability insurers have agreed on the outline of a voluntary scheme to assist mesothelioma sufferers with similar employers' liability (EL) claims. This is an appropriate and positive industry response to the Appeal Court's criticism of the law. We agree that payment of compensation in these cases - where employment spanned several different employers- should be shared between relevant EL insurers.

The ABI is anxious to discuss the details of a scheme - how it would work, levels of compensation (based on common law amounts), what happens when an insurer is insolvent and so on - with all interested parties.

We have started to do so, and this work will continue. Despite this, some already claim to know how much compensation would be available and have cited a figure. There is no proposed figure. It is foolish to attack the details of a scheme before they exist.

The immediate effect of the House of Lords decision to hear the cases, of course, is to delay payment of compensation to these claimants and - just as important - to postpone the introduction of the voluntary scheme.

Nevertheless, we respect the decision and will work with the outcome of the cases, whatever it is.

This is not a happy situation. How could it be? But the determination of the insurance industry has been to make it better, by going beyond legal obligations and seeking wider agreement on a positive way forward. Others should also be prepared to play their part.

John Parker
Head of general insurance
Association of British Insurers