Obesity, Liability & Insurance
Obesity is a growing international problem that is imposing immense additional costs on the economy and society as a whole, and becoming an increasingly important cost driver and exposure issue for insurers. A new report by the Insurance Information Institute (I.I.I.) titled “Obesity, Liability & Insurance” finds that insurers and reinsurers are just one of many industries that are affected by the obesity issue. In recent months snack food manufacturers and fast-food giants have become the target of lawsuits seeking to hold them liable for the alleged detrimental effects of consuming their products. Other industries with exposure include agricultural concerns, food processors and ingredient manufacturers, restaurant franchisees, broadcasters (especially those that market unhealthy foods to children) and advertising agencies. Similar to earlier lawsuits targeting “Big Tobacco”, and more recent suits against the alcohol industry, the obesity-related cases represent another extension of a trend toward attempting to attach liability for broad social and health concerns to private sector defendants. Even though insurers have never paid any tobacco settlements or defense costs, there are concerns that the legal cases against the food industry could leave insurers exposed to potential claims under certain general liability and product liability coverages. The report summarizes various areas of insurance industry exposure, including increased claim frequency and severity in health, disability and workers compensation coverages, as well as the likelihood of rising exposure to obesity-related tort actions affecting the liability and excess casualty insurance segments.
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