"One large insurer is now handling 25,000 silica claims from claimants in 28 states marking a tenfold increase from a year ago. Safety equipment manufacturers have also seen a rise in silica litigation."
The Wall Street Journal, 9/4/2003
Like asbestos, it can lead to a deadly lung disease when it is inhaled. Widely used in industry and potentially harmful or even deadly, silica could lead to the next wave of mass tort litigation.
Silica is often a component of materials used in mines, quarries, foundries, and construction sites, and it also is used in the production of glass, ceramics, and abrasive powders. Activities such as sandblasting, jack hammering, concrete mixing, and brick cutting convert silica into freestanding particles known as silica dust, which when inhaled can lead to illness or even death
With silica's broad range of uses, the potential for lawsuits is immense. The National Institute for Occupational Safety and Health estimates that 1.7 million workers in the United States are exposed to silica dust each year. And the number of silica-related lawsuits is growing. According to The Wall Street Journal, one of the largest silica manufacturers in the U.S. now faces more than 22,000 claims, compared to 3,505 last year.
The estimated $200 billion in cumulative asbestos litigation clearly illustrates businesses' need to manage the risks associated with potentially fatal industrial materials. With silica-related claims on the rise, now is the time to address and mitigate silica-related risks, before they become a billion-dollar problem.
Companies should examine their mass tort exposures and gauge their readiness in managing silica-related cases. By preparing for claims in the early stages of the litigation process, businesses may be able to mitigate costs in the long run. To gauge your organizations’ preparedness for silica related risks, you should ask the following questions:
- As a manufacturer or supplier of materials containing silica, are we liable for silica-related claims? If so, have we quantified the potential costs of these claims?
- As an employer that uses materials containing silica in business operations or production, are we liable if our employees file claims for silica related injuries?
- Is our staff exposed to silica dust during business operations? If so:
- What steps have we taken to decrease silica dust exposure among our staff?
- Should we provide staff with protective equipment?
- Do we need to inform our staff of the potential health risks associated with silica dust?
- Do we have a team of professionals in place to identify our exposures to silica-related risks?
- Do we have a strategy for managing suits brought against us?
- Do we understand our current insurance policies, as well as our old ones? Are they organized and structured chronologically?
- How will we find, manage, and organize data from old policies?
- How much can we expect silica-related litigation to cost our business? Are we prepared to assume these costs?
- Are we aware of the costs associated with claims litigation? Do we have a plan in place to reduce such costs?
- Are we planning to acquire or merge with another business that may be exposed to silica-related risks? Will we be exposed to silica-related risks as a result?
"The insurers, along with manufacturers that have used silica — mindful of the 60 or more companies that have filed for bankruptcy protection as a result of asbestos litigation — would like to see the courts deal summarily with the lawsuits before they become a problem as broad as asbestos."
New York Times, 9/6/2003
Your ability to answer these questions could have a profound impact on your company’s ability to manage silica-related risk. Consider the following services to help you identify, manage, mitigate, and prevent silica-related exposures:
Mass Tort and Complex Liability Consulting — Assists companies in understanding, organizing, mitigating, and resolving mass tort and complex liability exposures. Includes policy archeology, coverage analysis, and allocation modeling to support financial planning, mergers and divestitures, claims negotiations, and insurance recoveries.
Forensic Accounting and Claims Services (FACS) — Assists clients in establishing accounting protocols to track loss-related costs and expenditures as well as assessing large and complex damage claims. FACS services are critical for companies that must defend against claims.
Liability Claims Consulting — Assists companies in establishing processes and procedures for managing claims as well as assisting in the selection of third-party claim administrators. Also helps companies achieve measurable savings in claim costs whether they are simply insured, self-insured, or insured under loss-sensitive programs with significant retained risk. In addition, facilitates equitable and timely claim payments when dealing with complex claims, disputes over coverage, or difficulty in obtaining a claim payment.
Workforce Strategies — Identifies, quantifies, and assesses key risk issues related to employment and helps manage costs through customized, strategic solutions.
Silica, like all risks, is best handled through preparation. If you identify and manage your business’ silica-related risks now, you will be much better positioned to avoid potentially expensive exposures.
"Silicosis, an irreversible but preventable disease, is the illness most closely associated with occupational exposure to the material known as silica dust. Data indicates that a risk of silicosis, over a working lifetime, may occur even at the current NIOSH recommended exposure limit."
National Institute for Occupational Safety and Health, 5/20/2003
If you have any questions or would like additional information, please contact us.
