Topics covered:

E-Cigarette History

Definitions

Brief History of Tobacco and Legislation

U.S. Regulation of E-Cigarettes

Products Liability
Other Coverage Concerns

Research Studies and Resources

Conclusion

E-Cigarette History

There are two primary categories of e-cigarettes:

Closed systems – which utilize pre-filled cartridges. These are known as electronic nicotine delivery systems (ENDS), or e-cigarettes.

Open systems – which utilize a refillable tank that the user manually fills with solution. These allow users to inhale a heated aerosol containing nicotine and other substances; an activity commonly referred to as vaping. These systems include e-hookahs, hookah pens, vape pens, vaporizers, e-cigars and e-pipes.

When first introduced in China in 2004, e-cigarettes were shaped like cigarettes, cigars or pipes and contained nicotine in liquid or gel form. The e-cigarette was first introduced in the U.S. in 2007. In 2014 there were more than 450 brands of e-cigarettes available, in over 7,500 different flavors. Typically e-cigarette cartridges contain between 6 and 24 mg of nicotine per milliliter. It is currently estimated that over 2 million people in the U.S. use e-cigarettes.

E-cigarettes are now offered in hundreds of brands in many shapes and designs, and can be in disposable or rechargeable form. They can be and are used to inhale a variety of products from nicotine to marijuana. According to a December, 2016 report from the U.S. Surgeon General, e-cigarette use by high school students has risen by 900% from 2011 to 2015, with almost 1 in 6 high school students using e-cigarettes in the previous 30 days.

Definitions

E-cigarettes and their forms are continually evolving, which makes it difficult to describe them in a standard definition.

Follows are a few of the more standard definitions that are currently available:

E-Cigarettes –

Merriam-Webster: A battery-operated device that is typically designed to resemble a traditional cigarette and is used to inhale a usually nicotine-containing vapor.

Added NOTE under Merriam-Webster: Electronic cigarettes contain a liquid solution typically consisting of nicotine, various chemical substances (such as propylene glycol or glycerol), and often flavoring. The solution is heated by the battery producing the aerosol or vapor inhaled by the user.

Dictionary.com: A device used to simulate the experience of smoking, having a cartridge with a heater that vaporizes the liquid nicotine instead of burning tobacco.

American Nonsmokers' Rights Foundation: Battery-powered devices designed to mimic cigarettes by vaporizing a nicotine-laced liquid that is inhaled by the user.

U.S. Surgeon General: E-cigarette refers to all products that electronically deliver nicotine.

Vaping (Vape) –

Merriam-Webster: To inhale vapor through the mouth from a usually battery-operated electronic device (such as an electronic cigarette) that heats up and vaporizes a liquid or solid.

This electronic cigarette… contains a small reservoir of liquid nicotine solution that is vaporized to form an aerosol mist. The user “vapes”, or puffs on the vapor, to get a hit of the addictive nicotine… – John Tierney

When a person tokes, eats or vapes cannabis, a wave of THC, or tetrahydrocannabinol, washes into the brain. – Laura Sanders

Merriam Webster Medical Definition: To inhale and exhale vapor from an electronic cigarette or similar device like someone smoking a conventional cigarette; to inhale or exhale the vapor of.

Dictionary.com: Verb – To draw in and exhale the vapor from (an e-cigarette or similar device for marijuana). Noun – An e-cigarette or similar device for marijuana; a vape pen; or – an act or period of vaping.

Dripping –

It is reported that some teens use e-cigarettes for 'dripping', which is not yet defined in conventional dictionaries in relation to this use. So what is e-cigarette dripping? E-cigarettes heat liquid and turn it into vapor, which a user inhales and exhales in a large puffy cloud. While a conventional e-cigarette requires no effort on the part of the user, dripping allows a user to manually apply a few drops of liquid to the heating coil of the cigarette, and they can change from one liquid flavor to another. This produces a thicker cloud and likely improves the taste sensation.

Smoke Tricks –

Another use of e-cigarettes is making smoke tricks. This is done by inhaling the vapor or the aerosol, then blowing it out of your mouth or nose to create varying shapes and sizes. There are even vape fests and competitions where people can show off their skills, which is becoming very popular.

Brief History of Tobacco and Legislation

The tobacco plant is native to the Americas and its use goes back 2000 years or perhaps longer. In 1612 tobacco was the first crop grown for money in North America. Initially, tobacco was consumed by smoking a pipe or chewing and smoking a cigar. In 1614, beggars in Seville, Spain, collected scraps of cigars and rolled the tobacco into small pieces of paper, creating the first cigarette. Cigarettes were produced manually until 1880, when a machine to roll cigarettes was patented, and by the late 1880s, the Duke Company was producing 4 million cigarettes daily and on average people were smoking about 40 cigarettes per year. By this time, inventions in advertising enabled the Duke Company to print the brand name of cigarettes and pictures that were meant to be collector series of birds, flags, Civil War generals, and baseball players, frequently with historical or educational information on them. Photographs of women in various poses and wearing what might be considered revealing costumes for the time were also inserted, and these exceeded all expectations of their popularity.

Nicotine was isolated from tobacco leaves in 1828, and by 1890, 26 states had passed laws banning the sale of cigarettes to minors. By the 1900's several companies were manufacturing cigarettes. During WWI and WWII, overseas soldiers were given free cigarettes daily. By 1944 cigarette production was up to 300 billion a year. Service men received about 75% of all cigarettes produced, but at the same time marketing efforts were increasing and women also began smoking.

In 1964, the U.S. Surgeon General issued a report linking smoking with lung cancer and heart disease, and in 1965 Congress passed the Cigarette Labelling and Advertising Act. The Act required that every cigarette pack have a warning label on its side stating “Cigarettes may be hazardous to your health.”

A law passed by Congress in 1971 prohibited tobacco companies from advertising on the radio or television.

In 1994, the  FDA officially determined that nicotine was a dependency-producing drug; however, the U.S. Supreme Court subsequently ruled that the FDA could not regulate nicotine as a drug. With the FDA's determination and other negative attention directed to cigarettes, this spurred legal action that has resulted in tobacco companies being required to pay billions of dollars to cover health care costs of tobacco-related diseases.

In 1984, Congress passed the Comprehensive Smoking Education Act, requiring that cigarette companies rotate the labels on cigarette packs every three months using four different Surgeon General warning labels.

Since the 1980's, federal, state, local governments, and private companies have been taking actions to restrict cigarette smoking in public places. Many cities across the U.S. do not allow smoking in public buildings, restaurants, within a certain distance of schools, and some prohibit smoking inside vehicles where minors are present. Since 1990, airlines have prohibited smoking on airplane flights in the U.S. that are six hours or less. State taxes on cigarettes have increased exponentially.

On June 22, 2009, President Obama signed the Family Smoking Prevention and Tobacco Control Act that gives the FDA authority to regulate the manufacturing and marketing of tobacco.

U.S. Regulation of E-Cigarettes

In 2015, it was reported that 99% of e-cigarettes sold in U.S. convenience stores, supermarkets and similar outlets contained nicotine.

In August, 2016 the FDA began regulating all tobacco products, including e-cigarettes, cigars, e-pipes, vaporizers, vape pens, hookah pens and all other electronic nicotine delivery systems (ENDS). The new rule regulates the following:

Tobacco products may not be sold to anyone under age 18, in person or online;

A photo ID will be required to verify age;

Free samples may not be distributed; and

Sales of tobacco products may not be sold in vending machines unless they are in an adult-only facility.

The FDA position is that as long as e-cigarettes are not marketed as medical devices or for therapeutic purposes, they will be regulated as a tobacco product. However, if they are marketed as a device to help stop smoking, they must be regulated as drugs or medical devices and must pass through the same regulatory processes as other stop smoking aids such as nicotine patches and nicotine gums.

The accompanying chart E-Cigarette and Vaping Regulations is a snapshot of state tobacco/e-cigarette/vapor regulations as of May 1, 2017 referencing current state statutes pertaining to e-cigarette regulations and definitions, and age related restrictions and associated fines. The regulations shown in the chart are not all-comprehensive, and could have been updated or new laws effected since the date of this publication. Whenever possible, hyperlinks are included for reference. With respect to the definitions, wherever shown, “tobacco product” or “electronic delivery device” does not include products approved or certified for sale by the United States Food and Drug Administration, as those terms are defined in the Federal Food, Drug and Cosmetic Act.

Americans for Nonsmokers' Rights

In addition to the above state laws, the Americans for Nonsmokers' Rights http://no-smoke.org/ is a model ordinance prohibiting smoking in all workplaces and public places. The ordinance defines “electronic smoking device” to mean any product containing or delivering nicotine or any other substance intended for human consumption that can be used by a person in any manner for the purpose of inhaling vapor or aerosol from the product. The term includes any such device, whether manufactured, distributed, marketed or sold as an e-cigarette, e-cigar, e-pipe, e-hookah, or vape pen, or under any other product name of descriptor.

Products Liability

Given the known and unknown dangers associated with the use of e-cigarettes, vaping or dripping, the carriers who are willing to provide product liability coverage are narrowing coverage with exclusions and endorsements. Carriers are hesitant to provide coverage for e-cigarettes because the medical community does not yet have enough data to prove their safety, and if e-cigarettes are not the healthy product as they are advertised they don't want to be in the same position they were in when insuring tobacco manufacturers.

Despite the growing restrictions that have been placed on its use, tobacco continues to be a viable product to the adult consumer. But the negative effects of the nicotine produced by the burning of tobacco have been quite costly to human health and the manufacturers, as evidenced by litigation awards in the last few years.

For example, in 2013 the family of Laura Grossman was awarded $37.5 million to be paid by R.J. Reynolds. Laura Grossman died from lung cancer in 1995 at just 38 years old, after smoking from age 15.

R.J. Reynolds Tobacco Company was ordered by a Florida jury to pay $23.6 billion in punitive damages to the widow of Michael Johnson, Sr., who was a chain smoker for many years and died of lung cancer in 1996. Mr. Johnson's estate had previously won a verdict of $17 million as compensation for his family's loss.

In a case against R.J. Reynolds and Philip Morris, a Jacksonville, Florida jury awarded a $40 million verdict on behalf of the husband and daughter of Patty Allen, who died after smoking two packs of cigarettes a day for 36 years.

In all of the above verdicts, the award amounts were largely for punitive damages with less than $38 million of the awards for compensatory damages. Tobacco is currently the leading preventable cause of disease, disability and death in the U.S.

With all of the unknowns, e-cigarettes are still considered an emerging risk to insurers and many are reluctant to provide occurrence based coverage.

Some carriers make use of absolute health hazard exclusions, while others use tobacco and carcinogen exclusions. Health hazard exclusions vary and some can totally exclude all health related issues, e-liquids, devices, or a combination of these items. Carriers do not want to be in a position where they have to defend or pay out claims for several million dollars.

One example of an absolute tobacco health hazard exclusion excludes “bodily injury” including, but not limited to, the actual or alleged emergence, contraction or exacerbation of virtually any type of cancer or pre-cancerous condition, heart disease, arteriosclerosis, emphysema or any other lung-related disease, or any other disease; caused by, resulting from, arising out of the use, consumption ingestion, inhalation, absorption of, contact with, or exposure to tobacco, any product containing tobacco or any product used with or related to the use of tobacco.

Another sample exclusion applies to all liability similar to the above, but also excludes other metabolic effects of “tobacco, tobacco products or tobacco byproducts” use, including shortness of breath, low resistance to infection or disease, psychological or mental injury or addiction. “Tobacco, tobacco products or tobacco byproducts” include, but are not limited to, raw or cured tobacco, nicotine, tar, any products containing tobacco or tobacco related substances or chemicals, cigars, cigar wrappers, pipe tobacco, cigarette filter, snuff, chewing tobacco, smokeless-tobacco products, cigarettes and cigarette paper, tobacco smoke, second-hand smoke, particles of tobacco, gaseous or solid residue or by-products of tobacco tips and filters, and any chemical, mineral or other product or components sprayed on, applied to, customarily found within or used in conjunction with any tobacco products.

The cigarette, e-cigarette and vaping industry statistics and studies appear to be rife with controversy. Depending upon which organization did the study, what was being analyzed, the measurements that were used, what statistics were being researched and who analyzed the results, it is easy to find one study contradicting another or some bias being attached to the study. Even among smokers, those who use e-cigarettes and those who vape, online blog posts can boggle the brain with all of the different results and analyses these users reveal and the references they use to support their opinion. It is no wonder that the U.S. government is delaying the FDA's regulatory authority to extend to all tobacco products, including e-cigarettes, cigars, and hookah and pipe tobacco (originally set for May 10 or later). Despite the growing number of studies and research, and with the increased use of e-cigarettes and vaping, there doesn't appear to be any clear-cut, absolute facts about the current or future health safety of these products for all individuals; or whether or not the use of e-cigarettes and/or vaping helps smokers kick their habit, or do or don't encourage people to start or continue smoking cigarettes.

Cigarettes burn tobacco, which produces the chemical nicotine. Because e-cigarettes deliver nicotine and flavorings through a vaporizer and not from burning tobacco, they are not expected to be as harmful to the lungs as other tobacco products.  However, health experts have raised many questions about the safety of e-cigarettes, particularly for teenagers.

Studies show that the typical ingredients found in e-cigarettes or e-liquids are liquid nicotine, propylene glycol (a syrupy synthetic liquid added to food, cosmetics, and certain medicines to absorb water and help them stay moist), vegetable glycerin and food flavoring. The main ingredients found in the e-cigarette liquids are glycerin and glycol ethers, which are used as the liquid carrier into which all of the nicotine, flavorings and preservatives easily dissolve. However, it is not presently known exactly what is in all e-cigarettes. In 2009, the FDA found detectable levels of cancer-causing chemicals, including an ingredient used in anti-freeze, in lab tests in two leading brands of e-cigarettes and 18 various cartridges. Additional testing has shown that some e-cigarette aerosols can contain additional ingredients of heavy metals, ultrafine particles and some cancer-causing agents such as acrolein, which could pose a threat to indoor air quality. The ultrafine particles likely fleck off the metal coil or soldered parts in the devices when heated. As many as 40% of these tiny bits of metal known as nanoparticles can travel deep into the lungs, potentially causing or worsening respiratory diseases such as asthma or bronchitis. For information on nanotechnology see: [Nanotechnology and Insurance.xml^Nanotechnology and Insurance^Nanotechnologyand Insurance]. Although e-cigarettes do not generate side-stream aerosols between puffs, the users release them when exhaling. The health effects of repeated exposure to these chemicals are not yet clear. There are no long-term studies on exposure to e-cigarette or vapor products, including their solutions, cartridges or flavors.

A study in 2014 found formaldehyde, a known carcinogen with potential to cause cancer, in overheated vapor produced by larger, high-powered e-cigarette devices known as tank systems.

Animal research shows that exposure to nicotine in the brain could cause changes that make other drugs more rewarding. Some experts believe this could be true in humans and thus the use of nicotine in any form would increase the risk for addiction and the use of other drugs. This leads some to suggest that e-cigarettes could serve as a gateway for youth to try other tobacco products, including regular cigarettes.

It has been discovered that if a person drinks, sniffs or touches the liquid in e-cigarettes, it can cause nicotine poisoning. Brightly-colored liquid nicotine comes in many flavors, including fruit and candy flavors such as gummy bear, soda pop or cotton candy, which are appealing to young children. The CDC reported the number of calls to poison centers involving e-cigarette liquids containing nicotine rose from one per month in September, 2010 to 215 per month in February, 2014, with more than half of these poisonings in children under age 5.

E-cigarettes are not subject to manufacturing standards, and the majority of imported e-cigarettes are from China, where most of these devices are manufactured without any regulations or safety standards. The FDA has issued a warning that the health effects of e-cigarettes have not been fully studied. The content of nicotine and quality of ingredients can vary widely and some e-liquids may even be nicotine-free, which would put them outside tobacco regulations. While the Family Smoking Prevention and Tobacco Control Act prohibits distribution of free samples of cigarettes, smokeless tobacco or other tobacco products, this does not pertain to products that do not contain nicotine. Therefore, there are likely to be future liability claims that arise out of contaminants not being listed on the product label; and from explosions and fires from batteries or other accessories.

The FDA identified 134 incidents of e-cigarette batteries overheating, catching fire or exploding in the U.S. during a seven-year period ending in January, 2016. While the number of reported e-cigarette explosions is considered minimal compared to the number of e-cigarette users, those persons who have experienced injury from battery explosions are seeking to hold the manufacturers responsible. The manufacturers must warn the public of known risks associated with the product use and provide adequate instructions for their proper use. E-cigarettes are being marketed as a 'safer alternative' to regular cigarettes, but the occurrences of fires and explosions are increasing safety concerns. E-cigarettes use powerful lithium ion batteries and sales of cheap, inferior devices pose a threat to reputable marketers of better products.

Further, if an e-cigarette company decides to change the batteries they use, this would effectively change their product resulting in a new “tobacco product”, requiring the company to apply for and receive a new PreMarket Tobacco Application (PMTA), from the FDA. Naturally, this would entail a lengthy and costly process.

The refillable cartridges pose a health and safety risk from the dangers of some users, possibly exposing themselves to potentially toxic levels of nicotine when refilling them. Some cartridges could also be refilled with substances other than nicotine, which might serve as a potentially dangerous way to deliver other drugs or harmful substances.

The health effects of flavor ingredients as used in e-cigarettes are also not certain. They have FEMA GRASTM status for use in food; however, that only means they are safe to eat, and does not apply to inhaling through e-cigarettes.

The quality of the e-liquids and making sure the e-liquid manufacturers follow good manufacturing processes can be provided by the American E-Liquid Manufacturing Standards Association (AEMSA).

UL is a global independent safety science company that partners with businesses, manufacturers, trade associations and international regulatory authorities offering safety solutions. The company claims that their new UL 8139 product provides a framework to evaluate, test and certify the electrical and battery systems of vaping devices. Their claim is that it is able to test specifically the safety of the electrical, heating, battery and charging systems.

Dripping increases safety concerns in that it generates higher heat temperatures of the coils than an e-cigarette. The higher temperatures can lead to greater emissions of a class of harmful chemicals known as volatile aldehydes, including formaldehyde (a human carcinogen directly involved in causing cancer) and acrolein. Acrolein causes burning of the nose and throat and can damage the lungs.

There are currently no restrictions on advertising or pricing of e-cigarette or vaping products, and they are marketed on television and by mainstream media. Research from the EPA reveals that spending on e-cigarette/vaping advertising increased from $6.4 million in 2011 to $112.9 million in 2014. This is obviously a rapidly growing market.

Other Coverage Concerns

With the regulations permitting e-cigarette purchase and use in adult-only locations, retailers and bars that permit their use will likely see an increase in exposures. According to the National Association for Shoplifting Prevention, retailers lose up to $13 billion each year because of shoplifters. E-cigarettes and related products are small and expensive and their increased use increases the likelihood of theft, particularly in shops where there are no or ineffective security cameras, or in dark areas. Having patrons spend time on-site, such as in a cigar bar, increases the premises liability exposure. Property exposures may increase due to the possibility of explosion and fire from the devices.

E-Cigarette Studies and Resources

On May 4, 2017, Truth Initiative® released a survey concluding that nearly half of current and former smokers age 21 and older have tried e-cigarettes, most of them to try to quit or reduce smoking. The survey confirms however, that consumers are uncertain about the products' effectiveness in that regard, and are confused about their health effects.

A recent study that compared e-cigarette vapor and cigarette smoke emissions found no evidence that vaping products may propagate cancer, while the contrary was observed of combustible cigarettes. The study, comparative tumor promotion assessment of e-cigarette and cigarettes using the in vitro Bhas 42 cell transformation assay, was conducted by BioReliance, funded by British American Tobacco (BAT) and published on Environmental and Molecular Mutagenesis. Similar studies carried out previously, namely one carried out by Public Health England and the one by BAT, had found that vaping is between 95% and 99% safer than smoking. In line with these studies, data obtained from this latest research found that cigarette smoke has cancer-promoting agents, while e-cigarette vapor does not, hence confirming that e-cigarettes are a safer alternative to their combustible counterparts.

The number of vape shops, or e-cigarette and vaporizer retail shops across the country are increasing, and experts estimate there were 5,000 to 10,000 vape shops in the U.S. in 2014, more often visited by hookah users or cigarette smokers than those who were non-hookah users or nonsmokers.

In December, 2016, the Surgeon General released a comprehensive review of the public health impact of e-cigarettes on U.S. youth and young adults. The culmination of this review is that the same strategies used to prevent tobacco use among young people should also be applied to e-cigarettes. However, success will require working together, aligning and coordinating efforts across a wide range of stakeholders, including individuals and families; public health professionals and clinicians; federal, state, local, tribal and territorial governments; public health agencies; and researchers – a huge undertaking and daunting initiative.

Truth Initiative®

Known previously as American Legacy Foundation, Truth Initiative® https://truthinitiative.org/, was established as part of the 1998 Master Settlement Agreement between major U.S. tobacco companies and 46 U.S. states, the District of Columbia and five territories. Truth Initiative® uses rigorous science and research studies to identify the most effective means to minimize the harms of tobacco use, measure the effectiveness of interventions and to identify best practices for tobacco control. They then share their findings with decision-makers at all levels so that the programs and policies they build will help prevent youth and young adults from using tobacco and to help current tobacco users.

Some Additional Resources:

American Public Health Association https://www.apha.org/

Center for Public Health and Tobacco Policy (Boston) http://tobaccopolicycenter.org/

Centers for Disease Control and Prevention (CDC) https://www.cdc.gov/

ChangeLab Solutions http://www.changelabsolutions.org/

Legal Resource Center for Public Health Policy http://www.publichealthlawcenter.org/programs/tobacco-control-legal-consortium

Smoke Free Alternatives Trade Association http://sfata.org/

Tobacco Control Legal Consortium / Public Health Law Center http://www.publichealthlawcenter.org/topics/tobacco-control

FDA Tobacco Action Center http://www.publichealthlawcenter.org/topics/tobacco-control/fda-tobacco-action-center

World Health Organization http://www.who.int/en/

Conclusion

With the limited data and lack of thorough scientific studies that exist in product evaluations on the safety of e-cigarettes, insurers and consumers have no way of factually knowing whether or not there are therapeutic benefits to their use, or how their health effects compare to cigarettes. Long term effects cannot yet be determined. Further, the safety concerns pose a risk to those insurers seeking to provide coverage to manufacturers of these products, and their increased use poses additional exposures to retailers and adult-only establishments that permit these products. The prudent insurer will need to stay informed as the emerging risks of these products develop and also stay abreast of federal and state litigations and future government oversight to protect their and their customers' profitability potential.