The advent of class action lawsuits in the United States can enable insurers to negotiate and settle the myriad of outstanding issues and claims involved in the Superfund crisis in one event.

That was one scenario presented by Chubb Corporation president Mr. Dick Smith at a Princess Hotel luncheon organised by the Bermuda Insurance Institute.

He warned industry representatives that the survival of the US insurance industry was at stake in the ongoing battle over Superfund, especially because governments found it easy to pass on a tax burden to insurers in recent years.

Insurers, US legislators, industry leaders and environmentalists have wrestled with the issue for many years. The question was who would pay what portion of the trillion-dollar bill required to fund the clean up of toxic waste sites in the US.

Superfund was designed to empower the US Environmental Protection Agency (EPA) to identify and force clean-up of the worst US hazardous waste sites. But the number of sites grew significantly (2,400 EPA initiated emergency clean-up operations) and the programme itself has been blamed for the slowness of action, astronomical costs and the creation of a legal quagmire that has diverted much of the clean-up money to litigation costs.

The companies who created the problem by dumping toxic substances in areas approved and designated by the US government, looked to their insurers when environmentalists began pointing out the dangers and urged them to pay for the clean-up, for the relocation of communities and other related issues.

Mr. Smith has been active with the American Insurance Association's Special Committee on Superfund legislation since 1989 and was named chairman of in January.

His message this week was one of urgency for the insurance industry to take an active role in resolving the issue that is currently before Congress.

Congress is working to a deadline this year to provide Federal Reauthorisation legislation to retain government money and a government plan to provide for the clean-up.

Heavy litigation has enabled lawyers to make substantial sums of money but yet little is being done to completely resolve the problem, said Mr. Smith.

He reflected the concerns of many close to the issue that with the other matters facing the US Congress, the issue may not get resolved in the near term. Outstanding issues facing the Congress include health care reform and former House Ways and Means committee chairman, Rep. Dan Rostenkowski, battle against fraud charges. Ways and Means is the congressional key to the financing of projects.

With Congress having little more than 30 active days of sitting left this year, there is the possibility that the matter won't be resolved before it closes out the session.

He said key points included who is liable, who will pay and when, and what the clean up standards would be. He asked if some money could be saved and diverted to other clean-up efforts if land was not restored to the absolute pristine condition in which it began.