Over four decades ago, it was established that companies were using asbestos in their products despite their knowledge of its lethal health risks. As more people began to file lawsuits and companies were unable to satisfy their financial liabilities, asbestos trust funds were created.
North Carolina residents may know that asbestos is responsible for many illnesses including mesothelioma, which has no known cure. People who contracted mesothelioma and other types of asbestos-related diseases were filing individual lawsuits against the companies they worked for. This not only placed a burden on the victims, but also companies that were forced to file for bankruptcy.
Companies are able to file for Chapter 11 Bankruptcy — which allows them to continue running their business while reorganizing their finances and paying off their debts — as long as they create a trust fund for the purpose of compensating victims of asbestos exposure. The trusts are set up in accordance with bankruptcy court guidelines and are managed by a board of trustees.
These trusts contain often large amounts of money which can be accessed by filing a trust fund claim without the need for asbestos litigation. Those filing a claim will generally need to show proof that they have an asbestos-related illness which was caused from exposure to the company’s product. Families of those who suffer from an asbestos-related disease or who have suffered an asbestos-related death may also file a claim for compensation.
Different levels of compensation will be paid depending on the type of disease and the amount of money the trust is able to provide. Because the trusts seek to ensure that there will be enough money for future claimants, they will typically pay a certain percentage of the victim’s claim depending on the severity of the asbestos-related disease.
Despite regulations, asbestos-related illness is on the rise due to the particularly lengthy amount of time it takes for symptoms to surface after exposure. Since the first asbestos trust fund was created in the 1980’s, billions of dollars in compensation have been paid to victims and billions more remain available for future claimants.