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Forever chemicals, or PFAS, are big news today. According to a Bloomberg Law analysis, more than 6,400 PFAS-related lawsuits were filed in federal courts between July 2005 and March 2022. As more research emerges, many experts expect the wave of litigation to become a tsunami as concerns grow about the impacts these chemicals may have, both on people and the environment.

“This big question is if this is going to be the next asbestos,” says Raymond Rogissart, Esquire, Senior Product Consultant for Nationwide E&S/Specialty.

Understanding PFAS

These substances making the headlines in ever-increasing frequency include per- and polyfluoroalkyl substances (PFAS), a group of man-made chemicals that includes PFOA, PFOS, GenX, and many others. Since the 1940s, PFAS have been manufactured and used in a wide range of industries in the United States and around the world.

“They're called forever chemicals because they don't break down in the body or in the environment,” explains Rogissart.

PFAS is used in manufacturing products that need to be water or oil repellant. This includes hundreds of everyday products, such as cosmetics, non-stick cookware, water-repellent clothing, fire-fighting foam, stain-resistant fabrics and countless other ordinary items we come into contact with each day.iii

Potential risks, revealed

While researchers have not been able to prove that exposure to PFAS directly causes adverse health effects, some studies have shown there may be a positive association between these chemicals and a range of conditions, including increased cholesterol levels, uric acid levels, liver enzyme levels, reduced kidney function, increased risk of thyroid disease, reduced immune system functions, ulcerative colitis, asthma, preeclampsia and decreased birth weight.iv

“PFAS chemicals are also on the radar of the Environmental Protection Agency (EPA) for their impact on the environment,” notes Rogissart.

The EPA has found elevated levels of PFAS in groundwater and landfills near companies that manufacture products with forever chemicals.

“Over the decades, these chemicals have been released into the environment and have built up in water, soil and air,” he explains.

Claims and litigation on the rise

The EPA believes that PFAS, whether it's encountered through the use of products manufactured with it or through the environment, may be a possible carcinogen, although more research is needed to confirm that a link exists.

“As a result, there has been and continues to be litigation against PFAS manufacturers and manufacturers of PFAS-containing products for environmental cleanup and remediation, with some lawsuits against these companies including personal injury claims,” says Rogissart.

From 2018 to 2020, six settlements in Minnesota, Michigan and Alabama regarding PFAS environmental pollution cases have ranged from $2.7 million to $850 million. The highest-profile personal injury PFAS lawsuit settled for $670 million in 2017 in West Virginia.

Growing claims and litigation related to PFAS are impacting both manufacturers and insurers, which underscores the importance of managing the risk of forever chemicals.

Mitigating the risk to insureds

Experts believe that companies that manufacture PFAS and products that contain PFAS or use it during the manufacturing process are at an increasing risk of litigation as the body of research on these forever chemicals grows.

“Insurers are likely to see new claims based on PFAS contamination of municipal and private water supplies and landfills, as well as product liability claims,” Rogissart notes.

Insurers, including Nationwide E&S, are taking measures to educate insureds about the limitations of their coverage regarding PFAS.

“Although Nationwide's pollution exclusion already bars coverage of PFAS, we'sre in the process of creating an exclusion specifically for PFAS to add further clarity to our policies,” says Rogissart.

He says that businesses can help protect themselves by learning as much as they can about PFAS and take efforts to reduce their exposure by making modifications to their operations.

“We're here to support our partners and our insureds as they navigate this issue by providing them with the information they need to understand the potential impacts of PFAS and reduce their risk, which is a win for everyone,” sums up Rogissart.

1 Bloomberg Law Review, “Companies Face Billions in Damages as PFAS Lawsuits Flood Courts,” May 23, 2022, https://news.bloomberglaw.com/pfas-project/companies-face-billions-in-damages-as-pfas-lawsuits-flood-courts

ii United States Environmental Protection Agency, “Basic Information on PFAS,” https://www.epa.gov/pfas/basic-information-pfas(Last visited September 10, 2021)

iii United States Environmental Protection Agency, “Basic Information on PFAS,” https://www.epa.gov/pfas/basic-information-pfas(Last visited September 10, 2021)

iv United States Environmental Protection Agency, “Basic Information on PFAS,” https://www.epa.gov/pfas/basic-information-pfas(Last visited September 10, 2021)