PFAS: Considerations for property and casualty insurers
PFAS could represent a substantial liability exposure for insurers. Are you prepared?
Verisk is exploring the potential liability exposures related to PFAS and is currently planning updates to the ISO General Liability Insurance Policy Program and other commercial lines of business in response to evolving PFAS liability trends.
Access our latest research and learn about other Verisk initiatives concerning PFAS:
What's PFAS?
PFAS stands for per-and polyfluoroalkyl substances but you may know them by their more ominous moniker: “forever chemicals.”
They’ve earned the nickname because PFAS tend to persist in the environment and resist breaking down. According to the National Institute for Environmental Health Sciences (NIEHS), “PFAS molecules are made up of a chain of linked carbon and fluorine atoms. Because the carbon-fluorine bond is one of the strongest, these chemicals do not degrade in the environment.”1
PFAS aren’t just stubbornly persistent, they’re ubiquitous. They’re used in a range of products including cookware, clothing, carpets, and fire-fighting foam, to name a few. According to the NIEHS, PFAS chemicals have leached into our soil, air, and water and have been found in the blood of 97 percent of Americans.2
A warning light: PFAS linked to adverse health
According to the NIEHS, research conducted on PFAS chemicals done to date “reveals possible links between human exposures to PFAS and adverse health outcomes.”3 These outcomes include: “Altered metabolism, fertility, reduced fetal growth and increased risk of being overweight or obese, and reduced ability of the immune system to fight infections.”4
Are PFAS "forever chemicals” becoming a significant liability event?
The latest news and analysis
Read the latest news and research on PFAS from Verisk’s Emerging Issues team.
Proposed PFAS legislation has some public utilities concerned
As concerns around PFAS chemicals grow, the EPA is poised to take stronger action, raising liability fears from water utilities.
Read the article
New EPA drinking water advisories set acceptable PFAS levels near zero
The Environmental Protection Agency has issued strict new rulings on PFAS in drinking water. Here's what you need to know.
Read the article
New research highlights the extent of PFAS groundwater contamination
The true extent of PFAS groundwater contamination is only now coming to light. Here's what insurers need to know.
Read the article
Some microplastics bring PFAS concerns - and vice versa
Are microplastics a vector for PFAS contamination? New research suggests linkages between the two.
Read the articleLearn more about PFAS
This Emerging Issues webinar was held on March 22, 2022, and featured Dr. Rainer Lohmann, Professor at the University of Rhode Island and Director of STEEP (Sources, Transport, Exposure & Effects of PFAS), a research center sponsored by the National Institutes of Health (NIH).
The presentation highlights current trends in PFAS research, with a particular focus on how PFAS behave in the marine environment. Dr. Lohmann touches upon the chemistry of PFAS, their health effects, and current efforts to regulate, replace, or remediate PFAS.
Are PFAS becoming a major liability exposure?
Are PFAS becoming a major liability exposure?
There have already been over $1 billion in settlements paid to date related to the allegedly deleterious environmental and health effects caused by PFAS.5 But the liability exposure may be significantly greater.
This report seeks to identify the mechanisms by which PFAS could continue to generate liability losses by using three of the emerging risk factors previously identified by Verisk’s Emerging Issues and Arium teams.
Those factors are evident harm, cultural relevance, and substitution.
Briefly, evident harm refers to a causal connection between a risk and resulting harms. Cultural relevance is determined, in part, by media and cultural attention to the issue—as public awareness spreads, the potential grows for litigation, legislation, and regulatory action. Finally, substitution refers to the danger of replacing one harmful product with another that turns out to be just as harmful, if not more so.
Modeling the potential impact of PFAS liability exposures
How might PFAS continue to develop as a liability risk?
There’s a lot to consider, such as the potential plaintiffs, the severity of potential losses, and the insureds that might bear these losses. Here are some considerations involved in modeling potential future PFAS liability accumulations.
PFAS and the ISO General Liability Program
As litigation concerning PFAS continues, Verisk is currently planning to introduce an optional endorsement to the ISO General Liability program to address PFAS exposures.
Participating ISOnet® subscribers can access additional information on this planned endorsement in the general liability panel agenda and minutes circulars.