Toxic Trio

‘Never underestimate the power of pink nail polish,’ goes an oft-repeated line on makeup blogs. Companies too might want to pay heed to this advice. For, the next big lawsuit or regulatory action might come from that colored liquid that prettifies tips and toes.

With increasing scientific, regulatory and consumer concerns, makers and suppliers of personal care products are facing higher scrutiny and the so-called ‘toxic trio’ of hazardous chemicals used in such products threatens to expose them to latent liabilities.

In a report, Allianz Global Corporate & Specialty (AGCS) and partner Praedicat, a science-based risk analytics company, highlight the risks to businesses and insurers from the ‘toxic trio’ - dibutyl phthalate (DBP), toluene and formaldehyde.

Research has shown that the three can possibly harm human health: DBP is likely a reproductive system toxin, toluene could impair the nervous system and formaldehyde could cause cancer.
Think these are found only in industrial boiling pots and chemistry labs? Wrong! Your innocent pink nail polish could be hiding a dangerous cocktail. Recently, nail varnish has drawn flak for potentially containing the three chemicals. Body lotions, hygiene products and fragrances are among other products that may have this toxic mix.

Know the dreaded three:

Dibutyl phthalate (DBP)

Used to soften plastics, DBP is also added to adhesives, printing inks, lacquers and textile. Plus, it is used in medicine coatings. Banned in the European Union since 2015, DBP may still be in perfumes, body lotions and other products in the United States. In fact, DBP exposure is so broad that Praedicat’s models suggest it has about a 1 percent chance of generating mass litigation-related losses of over $100 billion to the U.S. economy over several years.

When used in cosmetics, it can migrate into the surrounding environment. So DBP in body lotions, perfumes and nail varnish could enter the bloodstream through the skin. Researchers are studying possible links between DBP and disruptions in hormonal and reproductive systems and prenatal development.


Also called methylbenzene, toluene is found in fossil fuels. It is also produced when oil is refined and organic fuels are burnt. Toluene is common in paints and paint thinners, inks, adhesives, stain removers, fragrances, and hand and nail care products, among others.

It can be absorbed into the body via skin and through inhalation. Although toluene is slow to be absorbed through the skin, products such as body lotions give it enough time to do so. Toluene evaporates easily, which is why it is used in some cosmetics. So when such products are applied and are drying, toluene is present in the air. As many as 180 studies on its effect on humans have been published, with many pointing to health problems related to the nervous system.


Formaldehyde has been identified as a carcinogen. It is used to make resins, which are precursors to many chemicals used in processes that produce consumer products ranging from disinfectants, adhesives and laminates to clothing, paper and personal care products including some hair straighteners. The chemical has also been the subject of product liability lawsuits.

Formaldehyde can potentially cause blood, ear, nose and throat cancer as well as nervous and reproductive problems.

The three chemicals have long regulatory histories, being subject to permissible exposure limits by the U.S. Occupational Safety and Health Administration in 1970.

The efforts in this direction were largely driven by rising health issues among U.S. nail salon workers. In 2007, the U.S. Environmental Protection Agency published best practices for protecting the health of nail salon workers. Later in 2010, San Francisco even started recognizing some salons as ‘Healthy Nail Salons’ if they stopped using chemicals, among other factors.

However, regulatory attention might soon turn from workers to consumers as the use of personal care products rises, especially among children and teenagers. The most severe adverse health effects of these products might take years to surface, putting manufacturers and suppliers at risk going forward.

Some manufacturers responded to the concerns by producing and marketing ‘three-free’ nail products without DBP, toluene or formaldehyde. Some even went further with ‘five-’, ‘seven-’ and ‘nine-free’ products.

To verify the claims, the California Environmental Protection Agency (CalEPA) tested 25 nail products in 2012. Of the 12 products claiming to be free of one or more chemicals in the ‘toxic trio’, just two were truly ‘three-free’. In general, more products not making claims related to the ‘toxic trio’ were free of these ingredients than those that did make such claims.

The findings highlight how important it is for manufacturers to control their production process and accurately label the products. The CalEPA also detected 26 other chemicals in the samples. It’s not unimaginable that some other products claiming to be free of these chemicals might also not pass the muster.

As consumption of personal care products rises, companies stand to face greater risks, especially as children and teenagers increasingly use skin care, hair care, oral care, bath and shower products and fragrances.

Global sales of skin care products, the biggest segment of personal care items, is expected to grow 40 percent to $180 billion by 2024.

The wider the audience, the greater the potential liability exposure - there are higher chances of adverse effects being discovered and of more people being affected.

Increased regulation, however, can provide controls.

For example: Germany has banned DBP completely from baby products, personal health care products and toys. Toluene and formaldehyde can be used in limited quantities, only in specific products.

Using new scientific findings, regulators are working on reducing human exposure to harmful substances. Praedicat, using analytics to predict the path of scientific knowledge, gives a glimpse into the likelihood of regulatory action, making it easier for cosmetic makers and insurers to gauge the risks involved.

Personal care products are lifestyle products, which makes consumers less tolerant of side effects unlike in the case of medicines, the benefits of which could outweigh the risks.
With both manufacturers and suppliers vulnerable to such events, strict risk management procedures must be adopted by both parties. For all you know, the next season’s trending colors on the runway might come with new risks.

Allianz Global Corporate & Specialty (AGCS) is the Allianz Group's dedicated carrier for corporate and specialty insurance business. AGCS provides insurance and risk consultancy across the whole spectrum of specialty, alternative risk transfer and corporate business: Marine, Aviation (incl. Space), Energy, Engineering, Entertainment, Financial Lines (incl. D&O), Liability, Mid-Corporate and Property insurance (incl. International Insurance Programs).

Worldwide, AGCS operates with its own teams in 34 countries and through the Allianz Group network and partners in over 210 countries and territories, employing almost 4,700 people of 70 nationalities. AGCS provides insurance solutions to more than three quarters of the Fortune Global 500 companies, writing a total of 7.4 billion euros gross premium worldwide in 2017.

AGCS SE is rated AA by Standard & Poor’s and A+ by A.M. Best.

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Heidi Polke-Markmann
AGCS (Munich)
Phone: +49 89 3800 14303

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Sabrina Glavan
AGCS (New York)
Phone: +1 646 472 1510

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Susanne Seemann
Allianz SE
Phone: +49 89 3800 18170

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