Sexual Assault Settlements Soar, With Insurers Bailing; Universities Being Forced to Self Insure, Fight With Carriers
Sexual Assault Settlements Soar
WASHINGTON, D.C. (March 2, 2023) – Payments by colleges and universities to settle sexual misconduct lawsuits are souring. As a result, insurance companies are increasingly refusing to offer coverage, as well as contesting their liability under existing policies, notes public interest law professor John Banzhaf.
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The lawsuits are also growing more complex, including some brought by students who were accused of sexual assault.
For example, California State University Maritime Academy has just been sued by the family of a male student who committed suicide after being accused of sexual assault. It claims that "anti-male bias" in the handling the allegation drove him to take his own life.
In 2014, a major insurance company reported that only one sexual misconduct case topped $1million. By 2022, that number had jumped to 4, including:
- University of California system over $615 million
- University of Southern California over $850 million
- Michigan State University $500 million
- Pennsylvania State University settled for $93 million
As a result, many insurance companies are either refusing to insure universities against sexual assault claims, and/or are increasing exclusions, imposing strict requirements on universities, and switching to claims-based policies.
As a result, some universities are bring driven to self insure; using a new structure called a captive insurance company. Examples include Yale University, the University of California system, Rutgers University, and the University of Minnesota.
Either on their own initiative, and/or because of requirements or pressure from insurance companies, most universities now have programs for their students - often mandatory ones - designed to reduce the incidence of rapes and sexual assaults on campus.
However, charges Banzhaf, it appears from research that none now offered in the U.S. are effective - despite their enormous cost - in actually reducing the number of sexual assaults.
And, strangely, one program which has been shown in Canada to reduce rapes by almost 50% is apparently not being used in the U.S., despite the rising tide in Title IX complaints and lawsuits, the growing number of very expensive settlements, problems with insurance companies, and consideration for the young and often naive victims, says the law professor.
