A move by insurers to stop paying out to people diagnosed with a condition showing asbestos exposure has failed.
Insurers pay out millions every year to pleural plaque patients
A High Court judge ruled thousands of people with pleural plaques - scarring on the lung lining - were still entitled to compensation.
But the money they could claim, previously £5-£15,000, was reduced.
Norwich Union, Zurich and British Shipbuilders, who took the case, said the condition did not impair quality of life or lead to more serious diseases.
Insurers Norwich Union and Zurich both said they were considering an appeal, although they welcomed the reduction in the level of damages.
All parties accept pleural plaques rarely cause breathlessness or pain, and only a small proportion of those diagnosed later develop full blown cancer, such as the often fatal mesothelioma.
But lawyers for 10 men whose compensation claims were used as examples in the insurers' case, said the anxiety caused by seeing proof they have been exposed to asbestos deserved compensation.
The judge accepted they had an increased risk of developing other asbestos-related diseases, and that having the plaques caused anxiety.
Between £5,000 and £15,000 has been awarded to tens of thousands of people with pleural plaques since three High Court rulings in the 1980s made the condition "compensatable".
That will now be reduced to about £3,000 for provisional payments, and about £7,000 for full and final settlements.
Those claiming the lower provisional amount have the right to return with a later claim, should they develop a more serious asbestos-related disease.
That right was also protected by Mr Justice Holland's ruling at the High Court in Newcastle.
Ian McFall, national head of asbestos litigation for Thompsons Solicitors - representing two men in the case - said the judgment was a "victory" for the men and everyone else with a similar claim.
"This is good law, which puts people before profits," he said
Zurich UK General Insurance chief claims officer Bill Paton, said: "We are pleased this judgment brings some clarity to this difficult area.
"We also welcome the judge's pragmatic review of the appropriate levels of damages that should be awarded for people with pleural plaques."
Norwich Union also welcomed the clarification that psychological injury as a result of pleural plaques was "compensatable", and said the reduction in damages was a "good result".
The insurers had argued that plaques were not injuries in themselves and that any anxiety stemmed from worrying about having had exposure to asbestos, not from having plaques.
During a hearing in the case in December a QC for the insurers said the potential figures involved in paying out to people with pleural plaques were "monumental".
Antonio Bueno QC said the compensation claims were being made by the "worried well".
Trade union Amicus welcomed the judgment, saying it would affect about 14,000 cases every year.