The insurance industry, led by industry body the Association of British Insurers had said it will appeal the decision taken by the Scottish courts tot he UK supreme court after a five year legal battle.

The Scottish Court of Session, saw three leading Scottish law lords, Lords Hamilton, Eassie and Hardie uphold the 2009 Scottish Parliament Damages Act to allow people - mainly former shipyard and building workers - the right to seek compensation over plural plaques.

For Scotland, it repeals a 2007 House of Lords ruling that compensation would not be paid in the UK.

Pleural plaques - asbestos particles lodged in the lungs - in itself is not life-threatening. But it can be the first sign of fatal conditions such as mesothelioma, asbestosis and cancer.

Yesterday's ruling found that asbestos-related pleural plaques constitute "personal injury which is not negligible and is therefore actionable under Scots law".

The efforts of the lawyers for those affected by the illness have been opposed by the country’s leading underwriters including Axa, RSA and Aviva.

Frank Maguire with Glasgow law firm Thompson, who represent a sizable majority of Scottish victims of pleural plaques, told the country’s media that 40 Scots with the condition had died since the Lords denied them compensation in 2007.

He added: "This is a great victory for everyone involved. The insurers must now stop their unjust delaying tactics."

Nick Starling, the ABI’s Director of General Insurance and Health, said: “We are disappointed by this judgment. The insurers who brought this judicial review did so because there are fundamental legal principles at stake, and they remain confident that there is significant substance in their grounds for challenging the Damages Act.   The insurers are therefore preparing to appeal the judgment to the Supreme Court.

“The Damages Act is fundamentally flawed as it ignores overwhelming medical evidence that pleural plaques are symptomless, and the well-established principle of negligence that compensation is payable only when there is physical harm.  Insurers remain fully committed to paying compensation and pay out £200 million a year to those with asbestos-related conditions that impact on health, like mesothelioma. However, pleural plaques do not impact on quality of life and do not in themselves lead to asbestos-related conditions, such as mesothelioma”.

Peter Taylor, a consultant aft City law firm Hogan Lovells, said: "Insurers, in support of their action, suggested that the statute opened the way to a flood of claims from "the worried well", people who had plaques, but whose health and lifestyle was wholly unaffected by them. The numbers in issue were hotly disputed. The value of the claims in Scottish Courts that had been stayed ("sisted") awaiting the outcome of the petition was calculable, and was just over £10million. The potential for acceleration of claims levels and numbers was however very real."

He added that the implications in terms of the liability that faced the industry due to the ruling had the potential to be significant.

"The Government estimated the cost of existing claims for Scotland to be £17.125 million, with an annualcost thereafter of £5.5 - 6 million. Insurers however, suggested that the annual cost in Scotland alone would be between £76 million and £607 million.  The total cost in Scotland was said by some of the protagonists in the action to be as high as £8.6 billion, and that the UK figure for compensation payable for pleural plaques was potentially as high as £28.64 billion."