Hugh Stevenson, Chairman of Equitas, the vehicle set up by Lloyd’s in 1996 to runoff liabilities, principally asbestos and industrial pollution claims for years prior to 1993, issued a warning at the annual meeting of reinsured names, that Equitas faced an uncertain future due to the increasing number of U.S. asbestos claims.
According to a report in the Financial Times, a higher number of asbestos related claims have been filed in the U.S. than were anticipated.
Equitas recently strengthened its reserves by £711 million ($1 billion) to over £9 billion ($12.78 billion) total, but the FT stated that analysts believe the new claims may exceed the amount of the additional funds, putting further pressure on reserves.
A similar alarm was sounded last July, when Stevenson told the FT, “We have little or no control over many important external factors, such as legal developments, judicial decisions, and social trends, especially in the United States, all of which could threaten our stability.”
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