Article by Mary
Elizabeth Stern and Lucy
P. Allen1
Each year, we conduct an annual review of asbestos-related
liabilities reported in companies' SEC filings. This
information can assist companies in benchmarking their own data
against trends observed for other defendants, which can help to
forecast asbestos-related liabilities. Analyzing the 2012 data, we
find that the asbestos liabilities of solvent firms were relatively
unchanged in 2012 compared to 2011. On average, we observe no
increasing trend in either total liability spending or pending
claims against solvent defendants.
In last year's update, we reported that average dollars per
resolved claim had increased dramatically, rising 75% relative to
the average cost of a resolved claim in 2010. But we attributed the
increase to a changing disease mix of the resolved claims, rather
than an increase in firms' asbestos liabilities. Total 2011
indemnity payments rose by a much smaller fraction than the
increase in
