9/11 workers reach $650m settlement
The WTC Captive Insurance Company announced a settlement has been reached with attorneys for over 10,000 plaintiffs claiming injuries related to the rescue, recovery and debris removal operations following the 9/11 terrorist attacks.
The WTC Captive was created with a $1 billion FEMA grant to insure the City of New York and its debris removal contractors because in the aftermath of 9/11 the City of New York was unable to procure an adequate amount of liability insurance coverage in the commercial insurance market for the World Trade Center site rescue, recovery and debris removal work. The settlement provides a system for paying compensation for those claims of injuries made by people working on these operations for the City and its contractors, including construction, fire, police and other workers and volunteers.
The settlement will cost the federal-taxpayer funded WTC Captive $575 million at 95% plaintiff participation, or up to $657 million under certain conditions, leaving residual funds to insure and defend the City and its contractors against any new claims.
There could be additional sums depending upon the level of plaintiff participation and the extent of new lawsuits filed in the future. If there are few lawsuits filed in the next five years, there may be more money for current plaintiffs. To recover under the settlement, each plaintiff will have to submit proof that he or she was present and participated in the rescue, recovery and debris removal operations, as well as specific medical documentation and a physician’s diagnosis confirming their claimed illness or injury. All of this information must be submitted by plaintiffs under oath and will be subject to audit. Attorneys for the plaintiffs and WTC Captive will choose an independent third party expert to review each claim and the required medical documentation, further protecting against mistakes or fraud.
In addition to compensation for proven injuries, ranging from thousands of dollars to payments in excess of a million dollars, this settlement also funds a special insurance policy to provide additional compensation to any plaintiff contracting certain kinds of cancer in the future. Plaintiffs will have 90 days to review the settlement and "opt in," by agreeing to the terms of the agreement, which includes a release of any future claims against the City and its contractors involved in the 9/11 rescue, recovery and debris removal operations.
The agreement with plaintiffs’ attorneys requires that 95% of the plaintiffs bringing claims against the City and its contractors, covered by WTC Captive, "opt in" or agree to the settlement. Attorneys for the City, its contractors and the plaintiffs moved for a stay, or suspension, of the over 10,000 cases currently proceeding to trial under Judge Alvin K. Hellerstein in New York District Court for the Southern District of New York.
This settlement only involves the defendants in those cases who were insured by the WTC Captive Insurance Company, namely the City and its contractors, and not other private or public entities named in those lawsuits.
Individuals who worked or volunteered in the World Trade Center rescue, recovery and debris removal project have been entitled to and have received free medical care, including monitoring, funded by the City of New York and the federal government. Nothing in the settlement affects plaintiffs’ access to this care.
In the absence of commercially available insurance, the WTC Captive Insurance was formed in July 2004 to insure the City of New York and nearly 140 contractors, subcontractors and others it engaged against claims arising out of the debris removal process that began immediately after the collapse of the twin towers of the World Trade Center on September 11, 2001.
The mission of the WTC Captive is to insure and defend in court, and thereby to protect, the City and the contractor and subcontractor policyholders as claims are processed, adjudicated and resolved. Organized as a not-for-profit corporation under the laws of the State of New York and licensed by the New York State Insurance Department, the Captive is governed by a five-member Board of Directors composed of current and former City officials plus a representative of the City’s lead contractors.
