‘Nuclear verdicts’ are driving up the costs of doing business

The Wall Street Journal speaks with David Arick, the president of the risk management society RIMS, about corporate risk managers increasingly complaining about the growing number of so-called “nuclear verdicts,” a term referring to jury verdicts topping $10m. Arick says: “It’s a big concern for insurers, and [especially] insurers that cover certain industries like trucking [and] retail. Insurers are paying for these [verdicts], which drives up the cost of insurance, which drives up the cost of goods and services. It’s effectively becoming a tax.” A Philadelphia jury this year, for example, ordered Exxon Mobil to pay $725m to a service station mechanic who developed leukemia.