B.C. can sue tobacco companies for health costs

The Supreme Court of Canada has ruled that the B.C. government may sue tobacco companies to recover health care costs related to smoking, raising the question of whether tobacco insurers would ultimately be on the hook for any liability tobacco companies may incur.
In a 1999 report entitled ‘Tobacco in Canada,” Swiss Reinsurance Company Canada noted “it is estimated that each year, smoking costs British Columbia $1.5 billion, one-third of which results in direct costs to B.C.’s public health care system.”
The Swiss Re report also predicts that “despite the fears of some insurance analysts that tobacco litigation is an emerging threat to the insurance industry, developments over the last two years continue to indicate that these fears are baseless.”
The Swiss Re report says that, unlike the situation in which other harmful products such as asbestos, silicone breast implants and DES have been banned outright, the tobacco industry wishes to continue the manufacture and sale of tobacco products on a worldwide basis. In 1999, the estimated annual worth of tobacco products was US$45 billion.
“The tobacco industry can afford to fund the multi-billion dollar settlements on its own by simply shifting the costs to consumers and raising the price of a pack of cigarettes by less than 50 cents,” Swiss Re says in its 1999 report. “As a result, the tobacco industry is clearly in a unique position to continue funding of its own defence and any settlements without waging a coverage war with the insurance industry, which would inevitably result in the fourth wave of litigation confronting the tobacco industry.”