Insurers paid $43 million in Boston clergy abuse case

Recovery from insurance carriers was complicated by the fact that one of the insurers, Lumbermens Mutual, faced financial difficulties.

News Currents

The Roman Catholic Church in Boston has paid $150.8 million through June 2005 to settle claims of sex abuse by clergy, with $43.3 million of that paid by insurance companies, according to financial information released by Archbishop Sean O’Malley.

The $150.8 million includes the total costs of the sexual abuse settlements of $127.4 million plus $23.4 million spent on abuse prevention programs and outreach to survivors of sexual abuse, church documents show.

These figures include a global settlement of 541 claims reached by Archbishop O’Malley in the fall of 2003 at a cost of $84.1 million.

The total $43.4 million received from the two primary insurers for the archdiocese, Lumbermens Mutual and Travelers, has been supplemented by $20.1 million from the church’s own insurance reserve fund and $2.0 million in donations made specifically for the purpose of funding therapy assistance for survivors.

Recovery from insurance carriers was complicated by the fact that one of the insurers, Lumbermens Mutual, faced financial difficulties. Lumbermens provided general liability coverage beginning in the mid-1950s until early 1983, a span of time involving an estimated 80 percent of the claims.

In March 2004, the Archdiocese sued Lumbermens Mutual. The litigation concluded in February of 2005, when the parties achieved a settlement under which the Archdiocese received $20 million and forfeited any rights to claim against Lumbermens in the future.

The Archdiocese also reached an $8.5 million settlement with its other principal insurance carrier, Travelers Insurance Company, which provided general liability coverage for the period spanning 1983-1989.

With the settlement of the claims against Lumbermens and Travelers, the total amount received from insurance toward the $127.4 million in settlements negotiated and concluded by the Archdiocese through June 30, 2005 was $43.4 million, or about 29 percent of the sources of fund used to settle the claim.

Topics Carriers Church