Get Full Government Meeting Transcripts, Videos, & Alerts Forever!
Get email alerts on the Liability Claims Schools topic
No spam. Unsubscribe anytime.
Senators seek solutions as school districts face legacy sexual-abuse claims with missing insurers
Summary
Lawmakers asked the insurance commissioner whether guaranty associations or legislative remedies can protect public school districts facing settlements tied to decades-old abuse claims when historic insurers no longer exist; the commissioner said the department can help locate records and coordinate with guaranty associations but has limited statutory authority.
Senators raised concerns about the fiscal exposure of public school districts when civil statute-of-limitations reforms allow survivors of childhood sexual abuse to pursue claims against schools but the insurer that originally covered those institutions no longer exists.
A senator cited Clinton Township in Hunterdon County as an example where the insurer that would have covered alleged historic abuse no longer exists and the district faces the risk of covering settlements through budget cuts or capital deferrals. Lawmakers asked whether property-liability guaranty associations have authority to assist public entities in those circumstances.
Commissioner Justin Zimmerman said the department's role is constrained by statute. He said guaranty mechanisms such as PLICA (property-liability insurer guaranty association) exist to handle insolvency scenarios and that the department can help districts locate paperwork and engage the appropriate guaranty association (referred to in testimony as FLEAGA by the witness). He added the department would be willing to discuss potential legislative changes if current statutes leave gaps.
"The department doesn't have a role to play in this statute," Zimmerman said, but offered to help the district and the senator locate records and engage insolvency guaranty entities.
Senators said they appreciate the department's assistance and indicated they may pursue legislative remedies to protect school districts while honoring survivors' claims.
