Few risks illustrate the changing liability landscape as starkly as PFAS, where growing awareness, tightening regulation and aggressive litigation funding are combining to create a new generation of long-tail claims.

Despite the health risks of PFAS being first identified decades ago, the full risk profile of PFAS remains poorly understood, even as it permeates global supply chains. Per- and polyfluoroalkyl substances are present in thousands of products, from firefighting foams and industrial coatings to cosmetics, cookware and electronics. Their extreme pervasiveness means they can now be detected in drinking water, soil, the wider food chain and, critically, the human bloodstream. The result is a widespread exposure profile where potential claimants are numbered in the millions.

For insurers, PFAS has evolved into a classic long-tail liability risk. Carriers have tightened wordings, introduced broad exclusions or tight sub-limits, and often require extensive documentation before offering coverage. Exposure cuts across product liability, environmental impairment, public liability and D&O, among other lines.

The legal community has signalled what is at stake, as PFAS shifts into systemic liability risk territory, with mass litigation and sizeable settlements across the US, and a growing volume of collective actions in Europe. In the US, some manufacturers have agreed multi-billion dollar settlements with public water suppliers over alleged contamination. The AFFF multidistrict litigation has become the most significant aggregation of PFAS claims globally.

Crucially, plaintiffs’ lawyers are not limiting themselves to primary manufacturers. In the US, claimants are seeking to extend the defendant pool to secondary users in sectors such as cosmetics and food packaging, often by reframing causes of action away from complex bodily injury claims and towards theories of fraud, misrepresentation and deceptive trade practices. Allegations that products marketed as “all natural” or “non-toxic” contain PFAS allow plaintiffs to sidestep some of the most demanding scientific causation hurdles, focusing instead on labelling, disclosure and consumer expectations. In Europe, new collective redress mechanisms and the growth of third-party litigation funding are expected to drive similar large-scale litigation.

Regulators are finally responding. The UK government this month published its national PFAS Plan, explicitly framing “forever chemicals” as one of the most significant environmental challenges of our time. In the EU, PFAS regulation is, perhaps unsurprisingly, more advanced, with low maximum concentration limits in drinking water, mandatory monitoring in food, and a proposal that could restrict around 10,000 PFAS across multiple applications. The European Chemicals Agency is weighing options from near total bans to tightly controlled uses tailored to critical applications.

In the US, federal standards remain politically contentious, and timelines have been pushed back, but state-level bans, disclosure requirements and a succession of settlements are driving behavioural change. Major corporates have already announced plans to phase out PFAS production entirely, citing regulatory trends and investor and consumer pressure.

The asbestos analogy is never far from the PFAS discussion. UK Health and Safety Executive data on mesothelioma show how occupational asbestos exposures between 1950 and 1980 generated a steep rise in deaths over the following half century, with annual fatalities still in the thousands. That history is a stark reminder of how a once ubiquitous industrial input can crystallise into a lethal, long-tail liability.

Given all the forces at play, proactive organisations are integrating PFAS into ERM frameworks, and reviewing supply chains, products and historical footprints. For insurers, this unbound story is a live test of their ability to anticipate, price and structure coverage for systemic, cross-sectoral ‘forever’ liabilities. With PFAS, the insurance industry is confronting a familiar pattern with unknown scale: global use, uncertain but serious health concerns, and the prospect of claims that may run for decades.

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