BestWeek: U.K. Asbestos Verdict Eases Pressure on Insurers.

OLDWICK, N.J. -- The unanimous decision by the United Kingdom's highest court that the existence of asbestos-related pleural plaques is not grounds for compensation has been welcomed by the insurance industry, according to a story in BestWeek Europe.

The court, the House of Lords, also ruled that a psychiatric ailment caused by worry about pleural plaques is not enough to justify a demand for compensation.

The decision upheld a judgment in 2006 by the Court of Appeal in a test case that had been brought in 2004 by Zurich Financial Services and Norwich Union.

The decision upheld the duty of insurers "to compensate people who've suffered an injury and not to pay out policyholders' money for a condition that causes no symptoms and that cannot develop into any other condition such as lung cancer or mesothelioma," Zurich said in a statement.

"We welcome it," David Ross, a Norwich Union spokesman, said of the decision. "It reaffirms the previous decision that was made by the Court of Appeal."

The U.K. insurance industry had put aside an estimated 1.5 billion pounds (2.14 billion euros) to pay pleural plaques claims over the next 25 years, Ross said.

Pleural plaques involve asbestos-related scars to the interior of the lung. They can indicate a risk of mesothelioma, lung cancer or asbestosis.

"Proof of damage is an essential element in a claim in negligence," wrote Lord Leonard Hoffmann, a member of the court. "And, in my opinion, the symptomless plaques are not compensable damage."

An unfavorable judgment could have cost insurers more than a billion pounds, said international law firm Lovells, which normally acts for defendants in such cases.

Also, in BestWeek U.S./Canada:

Facing a challenging environment in the U.S. employer medical stop-loss market, Independence Holding Co. is focused on growing its fully insured health business by targeting small businesses struggling to find affordable coverage for their employees.

Also, in BestWeek Europe:

Global property/casualty insurer Aspen Insurance Holdings Ltd. announced it is establishing a unit to write global excess casualty insurance from Dublin, underlining the appeal of the Irish capital as a financial services center.

And in both editions of BestWeek:

The Best's Global Insurance Composite Index finished the week of October 18 up 11.08% from a year ago. The composite index reflects the performance of 176 insurance stocks. The week's top performers were SCPIE Holdings, Korean Reinsurance Co, Meritz Fire & Marine Insurance Co., Dongbu Insurance Co, and China Insurance International Holdings.

The bottom five performers were Aviva plc, Nissay Dowa General Insurance Co., Aioi Insurance Co., NIPPONKOA Insurance Co., and Infinity Property & Casualty Corp.

BestWeek is published by A.M. Best Co. for insurance professionals. To subscribe, please call A.M. Best's customer service department at [phone], ext. 5742, or e-mail your request to [e-mail].

Founded in 1899, A.M. Best Company is a global full-service credit rating organization dedicated to serving the financial and health care service industries, including insurance companies, banks, hospitals and health care system providers. For more information, visit www.ambest.com.