The Insurance Industry and Asbestos

Chubb and Sun 2.0 Update

The relationship between Chubb and the Sun Insurance Companies dates to at least the early 1960s. Sun Indemnity of New York/Sun Insurance Company of New York became Chubb Indemnity in the early 1990s. See January 8, 2010's blog entry for some background.

Here is an excerpt of a 1960s American Insurance Association membership list. Sun Insurance Company of New York (now Chubb Indemnity) and Sun Insurance Office Ltd. were indicated to be affiliated with Chubb.

In addition, in 1980 the asbestos manufacturer Johns-Manville sued some of their insurers and served Chubb with a lawsuit that named Sun Insurance Office Ltd. of Canada. This April 9, 1980 letter discusses Chubb's receipt of the lawsuit. In an April 1980 memorandum, a Johns Manville employee states that an insurance expert he met with in March 1980 said that Chubb manages Sun in the United States.

Chubb Denies Relationship With Sun

On the afternoon of October 22, 2009, oral argument took place at the United States Court of Appeals for the Second Circuit in New York City on issues that arose in part from the Johns Manville bankruptcy. The appeal involves Chubb Indemnity. The attorney for Chubb Indemnity made the following statements to the justices of the Second Circuit:

"The response to that is that Chubb Indemnity Insurance Company, the appellant here, is not Chubb Corporation. Number one. Chubb Indemnity Insurance Company’s a subsidiary of Federal, which is a subsidiary of Chubb Corporation. Perhaps more significantly, until 1992, Chubb Indemnity Insurance Company had no relationship whatsoever with Chubb.”

A justice on the Second Circuit then asked, "So in 1986 there was no relationship?"

The attorney for Chubb Indemnity replied, "Correct, Sir."

Chubb and Sun

Earlier blog entries reference Sun Indemnity Company of New York as being a predecessor to Chubb Indemnity. Sun Indemnity was founded in 1922 and later changed its name to Sun Insurance Company of New York. Chubb acquired Sun Insurance in 1994 but the companies had a long term relationship prior to the acquisition.

In the 1950s, Chubb & Son held itself out as the managers for the Federal Insurance Company, Vigilant Insurance Company, The Marine Insurance Company, Ltd., The Sea Insurance Company, Ltd., London Assurance (Marine Dept.) and Alliance Assurance Company, Ltd.

By 1963 Chubb was managing the Sun Insurance Group's United States entities. Here is a March 10, 1966 Chubb & Son letter which states that Chubb & Son is the manager of the Sun Insurance Company. This letter related to Sun Indemnity Company of New York insurance policies for Philip Morris.

During the 1980s, Chubb's Annual Reports stated that Chubb & Son was the U.S. manager of four of Sun Group's insurance companies - "a relationship of many years' standing."

Chubb's management relationship with Sun continued into the 1990s through the time Chubb acquired the Sun Insurance Company of New York in the mid 1990s.

International Claim Association

The International Claim Association was founded in 1909 and exists to this day. Charter members include Aetna Life Insurance Company, Employers' Liability, Maryland Casualty Company, United States Fidelity and Guaranty Company, and the United States Casualty Company.

The Association's constitution stated in part that:

"The object and purpose of this Association are declared to be as follows: To promote good will, harmony, confidence and co-operation generally between companies, and to devise and give effect to measures for the protection of their common interests, especially in matters for relating to claims; and the observance of the amenities that should exist between companies and associations."

By the 1930s, members included Aetna Life Insurance Company, Continental Casualty Company, Hartford Accident and Indemnity Company, Indemnity Insurance Company of North America, Maryland Casualty Company, Metropolitan Life Insurance Company, Prudential Insurance Company of America, Sun Indemnity Company of New York (today's Chubb Indemnity), United States Casualty Company and the United States Fidelity and Guaranty Company.

In 1939 at the 30th annual convention held at the Westchester Country Club in Rye, New York, Mr. A. G. Fankhauser of the Continental Casualty Company said in part that " A few years ago when the Program Committee went to considerable trouble to get an expression of opinion from the member companies and their representatives as to what subjects they would like to have talked about there was a large demand for a talk on pulmonary diseases, diseases of the respiratory tract."

Mr. Fankhauser then introduced Dr. Edgar Mayer of New York City who made a presentation to the Association on the topic of "Diseases of the Lungs." Dr. Mayer said, in part, "I should like to discuss certain problems of pulmonary disease which are of particular importance and interest to the Claims Division of insurance companies." During his presentation Doctor Mayer showed slides illustrating the x-ray appearance of some chest diseases including silicosis.

Representatives of several insurance companies were present for Dr. Mayer's presentation including individuals from Aetna Life Insurance Company, Colonial Life Insurance Company of America, Indemnity Insurance Company of North America and United States Fidelity and Guaranty Company.

The National Council On Compensation Insurance 2.0

The National Council on Compensation Insurance held their 1938 annual meeting at the NCCI's New York City offices on December 1, 1938. Members present included: Aetna Casualty and Surety Company, Aetna Life Insurance Company, Continental Casualty Company, Fidelity and Casualty Company of New York, Hartford Accident and Indemnity Company, Liberty Mutual Insurance Company, Maryland Casualty Company, and Sun Indemnity Company of New York (today's Chubb Indemnity). At the meeting the NCCI's occupational disease program was discussed. A report on the meeting noted that:

"There has been little change in the status of the occupational disease rates adopted in 1936 by the Special Committee on Occupational Disease." By 1933, the NCCI had a table of occupational disease rates which included asbestosis. An earlier blog entry on the NCCI can be found here.

In addition, a specific NCCI activity in Illinois was noted in the report of the 1938 annual meeting:

"In accordance with the provisions of Section 6 of the Illinois Act relating to the assignment of risks, the National Council, as the designated central agency, has been collecting for future hazard relativity determination purposes, the required engineering and medical data in connection with risks which have been assigned for coverage under the Illinois Uninsured Risk Plan involving the silica and asbestos occupational disease hazards... During the time in which the Council was authorized to collect these data, nine risks came to its attention involving the hazards of silica and asbestos."

The National Council On Compensation Insurance

The National Council on Compensation Insurance is a group of insurance companies that shares workers' compensation information. The NCCI collects data on workers' compensation claims and policies and uses the information for workers' compensation insurance rate recommendations. The NCCI became operational in 1923 and exists to this day. Here is some Workmen's Compensation Experience data compiled by the NCCI in 1925 as to the classifications asbestos goods manufacturing and asbestos-spinning.

Some members of the NCCI in 1933 included Aetna Life Insurance Company, Continental Casualty Company, Fireman's Fund Indemnity Company, Hartford Accident & Indemnity Company, Liberty Mutual Insurance Company, Pacific Indemnity Company, and Sun Indemnity Company (now known as Chubb Indemnity Insurance Company). The latter two members are currently part of the Chubb Group of Insurance Companies. In a 1933 report, the NCCI stated that they had "perfected the Occupational Disease programme, noted in the report of last year as having been begun." Here is the NCCI's 1933 table of occupational disease rates, which includes asbestosis, silicosis, and benzol (benzene).

Chubb Group of Insurance Companies

The Chubb Group of insurance companies includes the Federal Insurance Company, Chubb & Son (which is now a division of Federal), and Chubb Indemnity Insurance Company. Examples of companies the Chubb Group worked with include asbestos product manufacturers Raybestos Manhattan and Bell Asbestos Mines.

 

Chubb has specialized since the 1920s in underwriting mines in the Quebec, Canada. The majority of asbestos used in the United States was from Quebec province.

 

 

During the 1930s Hendon Chubb was an officer and board member of Chubb & Son and was on the board of directors of the Prudential Insurance Company and the St. Joseph Lead Company.