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The dollar amount per claim of asbestos-related liabilities for companies fell 35% in 2015, after nearly doubling four years earlier, according to a report by National Economic Research Associates Inc.
However, the Washington-based economic consultancy's annual review of Securities and Exchange Commission filings, released last month, also found that the number of claims resolved and the average dismissal rates rose, while the number of claims pending declined.
In contrast, resolution values rose roughly 75% in 2011 and remained steady for the next three years.
Lucy Allen, senior vice president and mass torts & product liability practice chair at NERA and a co-author of the report, said it was difficult to determine the cause for the striking drop in the dollar amount.
“It may be the sign of a new trend, which would be good for the defendants in that the dollars are going down” she said, “Or it could be that they're just clearing out claims that have been sitting there. It looks like a pretty dramatic change, but what's driving it, we're not sure.”
The firm has been tracking asbestos filings for 15 years, and Ms. Allen said researchers have not seen such a substantial decline in so-called dollars per claim.
The report said that the trend points to a period of relative stability in asbestos litigation, with filings, total indemnity spending and reserves remaining steady. Yet there is some uncertainty about future valuations.
If the drop in average dollars is related to the resolution of older claims, the report said, it may not project a future trend in values for recently filed claims.
“Whether the lower average values observed in 2015 will apply to the more recent filings going forward is not known,” the report said.
Total indemnity payments fell 15% but remained within the historical range.
The report attributed a significant decline in filings between 2004 and 2007 to a reduction in nonmalignant cases. So, the current filing activity likely represents malignant disease claims, such as mesothelioma and lung and other cancers, along with some remaining nonmalignant claims.
Though the disease mix is not known, the flat trend in filings since 2007 mirrors stable estimates in the annual incidence of mesothelioma over this period as reported by the National Cancer Institute's Surveillance, Epidemiology and End Results program, which provides information on cancer incidence and survival in the United States.
The NERA study analyzed data from more than 150 asbestos defendant's SEC filings from 2001 to 2015.
A federal jury in Arizona has awarded a total of $17 million to the surviving spouse and children of a worker who died of mesothelioma caused by exposure to asbestos.