Emerging downside risks keep coming


It is no longer necessary to wonder about the “next asbestos” as the current litigation environment and the recent pace of additions to the list of emerging risks and trends in P&C insurance are enough to keep the industry on its toes. guards.

Risks and trends “come more furiously and faster than [we saw] five or 10 years ago,” Ania Caruso, accident practice manager for the Southeast region at brokerage Gallagher, said at Advisen’s Casualty Insights conference in New York on April 6.

Factors such as social inflation and litigation funding have resulted in nightmarish losses for property and casualty insurers, not only for litigation involving opioids, talc, weedkillers and traumatic brain injury, but also for injury claims. professionals. And the list of risks that could potentially lead to future billion-dollar claims is growing.

“It’s tough,” Casey Petersen, WTW’s senior damage brokerage manager, said during a panel discussion. He said conversations with customers about emerging risks included a point or two. “Now it’s 12 pages.”

According to Bob Reville, CEO and co-founder of Praedicat, PFAS is the “greatest thing there is”. Found in many different consumer products, litigation involving PFAS chemicals is in its early stages but growing rapidly, Reville said.

“He has a huge footprint,” he said.

Known as the “chemicals forever,” PFAS have been used for 40 to 50 years in everything from fire-fighting foam to non-stick pans, making the potential risk “massive” since scientific studies have shown that the chemicals were harmful. The insurance industry’s total exposure from litigation could potentially amount to nearly $100 billion without taking into account anticipated water contamination lawsuits.

Additionally, just around the corner, Reville said it is preparing for claims involving microplastics. Studies over the years have found microplastics — very small plastic fragments — in the ocean, sea life, birds, air and more recently in people’s lungs, Reville said.

“The literature is emerging rapidly,” he added. “The shift to litigation could happen next year or after, but it’s a big exposure to the industry.”

Arsenic-related claims began surfacing last year, Reville said. In what may be the first example of a climate change liability claim, lawsuits have been filed against baby food manufacturers over high levels of arsenic in the rice product. Arsenic was found to be more concentrated in the soil due to drought and increased temperature.

Reville and other panelists said the agriculture industry could become more of a target for climate change litigation, especially when climate change can be linked to personal injury.

Agriculture could also be designated for litigation by victims of human trafficking. New legislation allows victims to sue entities that profit from human trafficking. In addition to agriculture, domestic services, shipping and hospitality industries can be subject to such lawsuits, added Connie Germano, president of insurance at Kalepa.

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