Black Hole Looms In Pollution Liability Environmental claims could come back to haunt insurers, analyst warns
The size of the environmental reserving “black hole” once estimated to be more than $100 billion has dwindled to under $25 billion, some experts contend, but that doesn't mean insurance executives can rest easy thinking the problem is behind them.
Referring to a $24 billion estimate disclosed in a December report by A.M. Best, William Wilt, an analyst for Morgan Stanley in New York, notes that the level of environmental liability underfunding for the property-casualty insurance industry is “actually bigger than it is for asbestos.” A.M. Best now puts the asbestos deficiency at roughly $14 billion.
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