Exposure to Asbestos Triggers Employer’s Liability Insurance

In 2012 the United Kingdom Supreme Court confirmed that employer’s insurance liability is triggered when an employee is exposed to asbestos, not when mesothelioma manifests itself. The case BAI (Run off) and Ors v Durham and Ors [2012] known as the employer’s liability ‘trigger’ case was yet another test case in an area of law which has fostered much protracted legal wrangling over many years. The long-awaited outcome of this decision has delayed the resolution of thousands of claims.

BAI (Run off) and Ors v Durham and Ors Facts

The claimants were employees that had been exposed to asbestos and had then contracted mesothelioma up to 35-40 years later. Employers had taken out employer’s liability insurance policies at the time of exposure with different ‘trigger’ wording. The time between exposure to asbestos and the onset of the disease meant that the ‘triggers’ for policies written on the basis of ‘injury sustained’ basis or ‘disease contracted’ basis rather than a ‘causation’ basis required clarification as to how the different wording should be construed.

The implications of the interpretation of the wording were important for establishing which insurers were liable for the claims – the insurers at the time of the exposure or the insurers at the time of onset of the disease.

BAI (Run off) and Ors v Durham and Ors Judgement

In the initial judgement, Burton J held that the ‘sustained’ wording should be construed in the same way as the ‘causation’ wording meaning that the trigger was the exposure to asbestos. The Court of Appeal held that the ‘contracted’ wording meant caused but not the ‘sustained’ wording. It allowed the appeal by the insurance companies overruling the lower court’s interpretation by equating ‘sustained’ with ‘suffered’. This meant that the trigger was the onset of the disease rather than the exposure to asbestos.

The Supreme Court determined that the specific policy wording did not make much difference in establishing liability. It ruled that the employers’ liability insurance policy in place at the time of the exposure was the relevant policy for answering the claims of victims.

Implications of BAI (Run off) and Ors v Durham and Ors

The Supreme Court’s ruling will bring certainty and some relief to the victims of mesothelioma as the ruling makes it clear that employers will be able to claim on their original employer’s liability insurance policies. Victims will also be able to claim directly against the original insurers even where the employer no longer exists. The wider implications for insurance cases are yet to be seen.

If you would like to discuss the implications of this case or have a claim you need assistance with, we have experienced lawyers who can help you. Please contact Sarah Vincent by email svincent@rollingsons.co.uk or by telephone 020 7611 4848.