Diocese of Springfield Reaches Agreement with Insurance Carriers

July 2, 2008

SPRINGFIELD - The Roman Catholic Diocese of Springfield has resolved the dispute with its insurance carriers over coverage for clergy sexual abuse. The parties to that action have jointly petitioned the Court for dismissal of the lawsuit filed by the diocese in 2005 against five insurance carriers. This settlement will enable the diocese to make available to the victims of sexual abuse an independent, voluntary arbitration system to quickly settle claims for any victim who has already notified the diocese of a pending, credible claim.

The monetary terms of the settlement call for a payment from the insurers to the diocese of $8,497,000. That payment includes $3,500,000 to partially replenish diocesan funds which previously had been advanced by the diocese to settle sexual abuse claims in 2004 as well as counseling and other victim assistance services.

Most Reverend Timothy A. McDonnell, Bishop of the Diocese of Springfield, made the following comment on today's settlement, "This is simply another small step in doing what we can, to try to, in some tangible way, address the unspeakable harm that was done. We will continue to do our best to try to assist the victims, and to protect young people from ever experiencing the horror of childhood abuse."

Counsel to the Diocese of Springfield, John J. Egan of Egan of Flanagan and Cohen, noted, "The settlement is significant because after three years of a thorough professional investigation of all diocesan records, depositions of third parties and of numerous officials of the diocese by the carriers, in our view, they like the Hampden County Grand Jury convened in 2004, found no credible evidence to support the allegations that any supervisor at the diocese had any prior knowledge of sexual abuse by clergy. Under the law, insurance carriers would have had no obligation to cover negligent supervision claims if diocesan officials were aware the abuse was occurring or likely to occur.”

He went on to state, “This payment supports what we have said from the beginning - that these terrible acts were done in secret and hidden from family, friends and clergy supervisors. Additionally, it means the diocese will have advanced a total of $12,700,000 as compensation to abuse victims. $7,700,000 was paid in 2004, and an additional $5,000,000 will be available now. All of this is in addition to providing ongoing counseling and reimbursement services to victims. Finally, an important reason the Diocese of Springfield settled now was to avoid the victims having to undergo lengthy depositions lawyers for the insurance carriers were prepared to take."

Bullets / Settlement

  • Total amount paid to diocese by insurance carriers - $8,497,000
  • $3.5 million represents repayment of one-half of $7 million advanced by diocese in 2004 to settle abuse claims
  • Diocese and insurers will establish a settlement fund of $5 million, with the balance
  • A total of $12 million in settlement payments will have been paid by the diocese to victims from 2004 to 2008
  • In addition to the $12 million, the diocese has extended an additional $1 million in counseling, programs, and real estate to assist victims
  • Victims will remain eligible to participate in continuing counseling and assistance programs at the diocese

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