Supreme Court allows pleural plaques compensation

Insurers are braced for a flood of compensation claims, following last week’s landmark pleural plaques ruling by the Supreme Court.

The court backed the Scottish government in its long-running fight with the insurance industry over whether pleural plaques sufferers are entitled to compensation for the condition.

The court decided that the Holyrood parliament acted within its powers when it passed the Damages (Asbestos Related Conditions) (Scotland) Act 2009, which allowed compensation for the condition north of the border.

Insurers were attempting to overturn the act, which overrules in Scotland an earlier House of Lords ruling that pleural plaques sufferers were not entitled to compensation.

The act’s backers claim that those who suffer from pleural plaques, which form on the lung membrane as a result of exposure to asbestos but result in no symptoms, are nevertheless entitled to compensation because of the distress caused by the condition.

Until last week’s verdict, Scottish pleural plaques sufferers’ claims were on hold, but can now proceed. The Scottish government, when pushing the bill through, claimed it would result in £7m to £9m worth of compensation claims, based on the assumption that around 1,200 individuals suffered from the condition.

But the ABI told Insurance Times that medical research suggested that pleural plaques were more common than the Scottish government acknowledges. A spokesman said: “As the Scottish government recognised, there is no reliable way of estimating how many individuals who have pleural plaques as a result of negligent exposure to asbestos will ultimately make a claim. There are a number of studies that suggest that pleural plaques are more prevalent among the population than the Scottish government acknowledges.”

The ABI cited two academic studies, both of which showed that people exposed to asbestos had around a 50% chance of developing pleural plaques within 30 years. Thousands of workers in Scotland’s traditional heavy industries, such as ship building and construction, were routinely exposed to asbestos until the 1970s.

AXA Commercial claims and underwriting director David Williams said it would be “terrible” if Scotland, having avoided the kind of increase in motor personal injury compensation witnessed in England, now saw an explosion of pleural plaques-related claims.

He said: “We are going to use money to line the pockets of claims farming solicitors and people who have no symptoms.”

He also expressed concern that England-based claims lawyers would seek to launch compensation claims for pleural plaques sufferers north of the border.

Insurers now have six months to mull over whether they will appeal the Supreme Court’s verdict at the European Court of Human Rights, which is the only judicial channel now open to them.