Health Insurers Need to Focus on Climate Change

Potential climate change litigation affecting insurers may be just beginning. A potential flood of lawsuits "will pose a challenge" especially because of demands for insurance carriers to cover defense costs or other liabilities, says attorney Stephen Rosenberg of Boston, writer of the Boston ERISA and Insurance Litigation Blog.

"Everything eventually makes its way through the insurance industry, in terms of any types of new lawsuits or liability theories," Rosenberg wrote. "Litigation over climate change will be no different. The suits are coming."

While the credibility of any potential climate change lawsuit has yet to be determined, "they will pose challenges for the insurance industry because the development of theories of liability in this area will eventually lead to demands for insurance carriers to cover the defense costs or liabilities arising from those theories," according to Rosenberg.

Health insurers are being asked to react to potential climate change because of its potential to compound current health issues, such as asthma; people exposed to hurricanes and floods; heat-wave related health issues; and more airborne allergens, rising temperatures, greater humidity, wildfires, and dust and particulate pollution may "considerably exacerbate" upper respiratory disease and cardiovascular disease, according to the National Association of Insurance Commissioners (NAIC).

Rosenberg, whose legal specialty includes insurance law, says he expects climate change litigation against healthcare insurers to be similar to asbestos and pollution cases. "This will raise a whole host of issues for carriers that will mimic the types of issues that played out with regard to the large scale—and often unanticipated—exposure posed by environmental litigation and asbestos, only on a broader and probably even more complicated level."

From the insurers' standpoint, much of the argument may rest on "no credible evidence " that the climate change caused health damages. While insurers can "make holes" in any plaintiff arguments, the potential "defense costs alone will be huge," he says.