Asbestos Trust Fund Compensation and Payment Guides

How Asbestos Trust Compensation Works

The U.S. Government Accountability Office found that each asbestos trust uses a TDP to govern claim administration and establish the process for assessing and paying claims. A claimant generally submits medical evidence supporting a qualifying asbestos-related disease and evidence connecting the claimant to asbestos exposure covered by that trust.

If the trust determines that the claim meets its requirements, the claim is assigned or negotiated to a liquidated value under the applicable review process. The trust’s payment rules are then applied to determine the amount actually payable.

There is no universal asbestos trust payout. Two trusts can recognize the same disease but use different disease values, Payment Percentages and review rules.

Scheduled, Average and Maximum Claim Values

Trust documents can use several different valuation terms. They should not be treated as interchangeable:

• Scheduled Value: a preset claim value commonly used when a qualifying claim is allowed through Expedited Review.
• Average Value: a benchmark used by some trusts when valuing Individual Review claims.
• Maximum Value: an upper limit for certain Individual Review claims under the governing TDP.
• Liquidated Value: the claim value determined before applicable Payment Percentage and other payment provisions are applied.
• Actual Payment: the amount ultimately issued after the trust’s payment rules are applied.

Not every trust uses all of these terms. Current official TDPs should be checked before comparing claim values among trusts.

How Payment Percentages Affect Compensation

GAO explains that most asbestos trusts cannot pay the full liquidated value of every claim while preserving sufficient assets for future claimants. Many therefore use a Payment Percentage—a fraction of the liquidated claim value that is currently payable.

Mathematical illustration only — not a guaranteed payment. If a hypothetical trust liquidated a claim at $100,000 and its applicable Payment Percentage were 20%, the arithmetic result would be $20,000 before any other trust-specific provisions.

Payment Percentages can change. GAO found that trustees periodically compare available assets, expected investment performance and claim statistics with forecasts of future claim volume and value. Depending on the trust’s governing documents, significant changes generally involve the Trust Advisory Committee and Future Claimants’ Representative.

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Expedited and Individual Review

GAO found that trusts typically offer claimants Expedited Review and Individual Review, although the exact rules differ by trust.

Under Expedited Review, a claim satisfying preset medical and exposure criteria is generally assigned the Scheduled Value for the applicable disease level.

Individual Review provides claim-specific consideration. The resulting liquidated value may be higher or lower than the Scheduled Value, and some trusts use Average and Maximum Values to guide or limit that process.

Some disease categories may be compensable only through Individual Review. A claimant should therefore review the actual TDP rather than assuming the review method with the largest published number will produce the largest payment.

From an Approved Claim to Payment

GAO’s review describes a typical sequence in which the trust evaluates the claim and supporting documents, conducts applicable quality-assurance review, makes an offer, and provides a release when the claim is allowed and valued.

If the claimant accepts the offer and satisfies the required release and payment procedures, the trust pays the claim under the established Payment Percentage and other TDP provisions.

If the claimant disagrees with the trust’s determination, the TDP may provide reconsideration, arbitration or other alternative dispute-resolution procedures. The available options depend on the particular trust.

What Can Affect Asbestos Trust Payment Timing?

There is no single payment timetable that applies to every asbestos trust. Timing can depend on whether the claim is complete, which review process is selected, the claim’s position in a FIFO queue, deficiency responses, audits, releases and trust-specific payment procedures.

GAO found that claims are generally processed under first-in, first-out rules within the applicable review queues. A deficient claim can require additional evidence before processing continues.

Some TDPs also use Claims Payment Ratios or maximum annual payment provisions to preserve funds and prioritize particular categories of claims. Those mechanisms can affect when otherwise qualifying claims are paid.

Compensation From Multiple Asbestos Trusts

A claimant may potentially have claims involving more than one trust when the exposure evidence connects the claimant to asbestos products or operations associated with multiple bankrupt companies.

GAO describes an occupational example involving a worker exposed at numerous worksites and shipyards who files claims with several trusts whose reorganized companies’ products or operations were identified at those sites.

Each trust independently determines eligibility and payment. A successful claim against one trust does not automatically establish eligibility for another.

Trust compensation may also interact with claims against solvent defendants in the tort system, depending on applicable law and disclosure or setoff rules.

Why Published Trust Values Are Not Guaranteed Payments

A disease table can be useful, but it does not by itself establish what a claimant will receive. The published value may be a Scheduled, Average or Maximum Value rather than an actual payment.

The claimant must first satisfy the trust’s medical and exposure requirements. The trust must then allow and liquidate the claim. After that, a Payment Percentage and other applicable rules may reduce or otherwise affect the amount paid.

Current official documents matter because Payment Percentages, TDP provisions, claim forms and administrative policies can change. Historical payment figures should not be presented as current without verification.

Likewise, historical trust funding should not be confused with current trust assets. Current financial information should come from recent official annual reports, audited financial statements or equivalent primary records when available.

Confirmed Primary Sources for Payment Facts

No law-firm or lead-generation website was used as factual authority for this guide. Government and official trust sources reviewed include:

• U.S. Government Accountability Office report on asbestos trust compensation, TDPs, claim review, Scheduled Values, Payment Percentages and payment administration.
• GAO accessible report text describing the asbestos trust claim and payment process, FIFO queues, Payment Percentages and supplemental-payment principles.
• Official ASARCO Trust resource center containing TDPs, payment rules, claim materials and trust reports.
• Official Kaiser Asbestos Trust resource center containing TDP materials, payment notices and claim resources.

Get Help Reviewing Asbestos Trust Compensation

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Published disease values, Payment Percentages and historical trust payments do not guarantee compensation. Eligibility and actual payment depend on qualifying medical and exposure evidence, claim valuation, the responsible trust’s current TDP and individual circumstances. Compensation is not guaranteed.