Syracuse diocese reaches $60 million insurance settlement to fund abuse compensation

By Mia MacGregor

April 29 - (The Insurer) - The Roman Catholic Diocese of Syracuse New York has reached a roughly $60 million settlement with six insurance companies to help fund compensation for abuse survivors, as part of its proposed plan to exit bankruptcy.

The settlement marks a step in the diocese’s reorganization effort under Chapter 11 of the U.S. Bankruptcy Code.

The diocese initially filed for bankruptcy in June 2020, facing more than 100 lawsuits filed under New York’s Child Victims Act.

A Chapter 11 filing allows an organization to pause litigation and restructure its finances while maintaining operations.

As part of its reorganization plan, the diocese proposed establishing a victims fund that will distribute a total of $100 million to abuse survivors. The contributions will come from both the diocese and its insurers, covering acts of abuse committed by clergy, religious members, lay employees and volunteers.

Several insurers initially objected to the diocese’s plan but reached agreements in the days leading up to a scheduled confirmation hearing.

According to court documents, several London market insurers agreed on April 25 to contribute $22.5 million to the trust. On April 26, Catholic Mutual agreed to pay $750,000 and Excelsior Insurance Company agreed to pay $1 million.

The following day, TIG Insurance Company, North River Insurance Company and U.S. Fire Insurance Company agreed to collectively contribute $500,000. All three are subsidiaries of Fairfax.

That same day, Allianz subsidiaries Interstate Fire & Casualty Company, National Surety Corporation and Fireman’s Fund Insurance Company reached a settlement to pay $35 million.

On April 28, The National Catholic Risk Retention Group agreed to contribute $1 million.

Together, these agreements total approximately $60 million in insurer contributions to the trust.