PFAS in Australia: what brokers need to know
PFAS – often called ‘forever chemicals’ because of how slowly they break down – are under the spotlight in Australia, creating new challenges for businesses and brokers. Here’s what’s changing and what it means for you.
PFAS is emerging as a key liability risk
PFAS (per- and polyfluoroalkyl substances) are everywhere – from firefighting foams to coatings and packaging. And they’re not new. They’ve been used in industrial settings for over 80 years.1
They don’t break down easily, which means they remain in soil, water and even the human body.
Globally, PFAS are driving lawsuits, regulatory crackdowns and clean-up costs.
In Australia, the firefighting foam used by the Australian Defence Force from 1970s-2000s contained PFAS. Class actions linked to historic use have resulted in settlements totalling more than $345 million.1
For brokers and businesses, this means:
- PFAS exclusions are becoming more common in liability policies
- Underwriters are asking more questions about PFAS risk
- Businesses will need to show strong risk management to secure cover.
What are PFAS, and what are their uses and risks?
PFAS are a large group of human-made chemicals with more than 15,000 identified different compounds.1 Historically, they’ve been valued for their resistance to heat, water, grease and stains.
Harnessed for these very qualities, they’ve been used for decades in:
- Firefighting foams
- Paint
- Non-stick cookware
- Food packaging
- Stain-resistant textiles and carpets
- Industrial coatings and sealants.
But here’s the catch: those same qualities make PFAS hard to break down and persistent in the environment – and in us.
The concern isn’t just environmental. There are possible human health risks too. Some health studies have identified a potential link between PFAS exposure and thyroid issues, immune system impacts, pregnancy complications and some cancers.2 However, there is not yet widespread consensus across the medical community and further studies are likely required to provide evidence of these links.
What’s driving PFAS exposure for businesses and insurers?
Though we’ve seen little by way of insured losses, several forces are amplifying PFAS risk globally and in Australia.
- Litigation is escalating: Australia has already seen major class actions, and in the US, chemical manufacturers have agreed to multi-billion-dollar PFAS settlements.
- Regulation is tightening: From 1 July 2025, Australia banned the manufacture, import and use of three PFAS chemicals – PFOS, PFOA and PFHxS – under the Industrial Chemicals Environmental Management Standard.3
- Public and investor scrutiny: Environmental, Social and Governance expectations mean businesses must show they’re managing PFAS responsibly. Investors now view PFAS as a material financial risk, and companies making sustainability claims without addressing PFAS could face litigation and reputational damage.
Which industries are most exposed?
PFAS risk isn’t limited to chemical manufacturers. Exposure can occur through products, processes or legacy contamination. Higher-risk sectors include:
- Aerospace and automotive
- Construction and infrastructure
- Waste and water management
- Food processing and packaging
- Electronics and industrial
- Clothing and cosmetics.
“Most brokers will have customers with some exposure – either directly or somewhere in the supply chain,” said Trent Koenig, National Manager, Technical & Business Performance – Liability at QBE Australia Pacific.
“We encourage brokers to start the conversation – explore where PFAS might appear and support customers with risk management strategies,” Koenig said.
Related article: Lithium-ion battery risks: Expert guide for brokers
How PFAS impacts insurance cover
To date we’ve not seen the legal liability associated with PFAS exposures covered by liability policies. Nevertheless, PFAS exclusions are increasingly showing up in insurance contracts for certainty.
This means businesses can’t rely on insurance to manage the risk. It’s important they understand where these chemicals might be present and make sure controls are documented.
“Businesses will want to know if they’re working with products or materials that contain these chemicals, and where in the process that exposure is,” said Koenig.
“If it’s a closed manufacturing system, there may be less of an exposure than if it interacts with the environment at any stage. But nothing works in a vacuum, and if a business works with PFAS anywhere in the process, there’s an exposure.”
For brokers with customers who may have legacy PFAS exposure, Koenig says it’s essential to explore what risks the customer is potentially facing.
“For example, common exclusions mean standard general liability policies won’t cover pollution that isn’t sudden or unexpected,” he said.
“So for any business that’s historically used PFAS, there could be an exposure arising from the gradual nature of pollution by PFAS that they’re not currently covered for,” he said.
Some environmental liability policies may offer protection for historic or undetected pollution risks. “It’s something a lot of brokers will look at as they seek protection for their customers,” said Koenig.
Practical steps to support customers
PFAS risk is complex and evolving fast, but brokers can help their customers stay ahead by taking proactive steps:
- Map PFAS exposure: Work with customers to identify where PFAS may appear in products, processes or supplier relationships
- Update proposal forms: Include PFAS questions and supplier attestations
- Gather documentation: Collect evidence of PFAS use and controls, such as safety sheets and site history
- Clarify cover: Review policy exclusions and make sure customers understand limitations
- Promote resilience: Encourage strong risk management practices and consider connecting customers with QBE’s Customer Solutions Panel providers for expert advice.
Level up your PFAS knowledge
- Watch the Emerging Risks in the Liability Market webinar
- Talk to your QBE Broker Manager about how we can work together to reduce risk and support your customers’ resilience strategies.
1 Source: Australian Bureau of Statistics. Per- and polyfluoroalkyl substances. Accessed on 29 September 2025.
2 Source: Stanford Medicine. Insights: PFAS, aka ‘forever chemicals’: what the science says. Accessed on 29 September 2025.
3 Source: Department of Health, Disability and Ageing (Australian Government). Updated ‘medical devices exempt from PFAS ban’ to include other therapeutic goods. Accessed on 29 September 2025.