MSU sues insurance companies involved in sex assault claims

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Michigan State University is suing more than a dozen of it’s insurance companies for refusing to cover the numerous lawsuits and claims related to Larry Nassar.

The former MSU and USA Gymnastics doctor was convicted of a handful of criminal sexual conduct charges in Michigan, but more than 300 women and girls say he abused them under the guise of treatment during two decades of practice. He will likely spend the rest of his life behind bars.

In the lawsuit, MSU claims that it’s insurance companies aren’t honoring policies that stretch back for more than a decade.

“We are suing our carriers, including our largest carrier United Educators, for failing to honor their policies,” said Robert Young, general counsel for Michigan State University. “It is disappointing and unfortunate we have to go to court on this matter, but we are hopeful this lawsuit will bring us to speedy resolution and that the insurance companies will honor their contractual obligations.” 

MSU says it’s racked up millions of dollars in defense fees and costs which are covered under the terms and conditions of it’s insurance policies.

However MSU claims no insurer has paid any amounts to reimburse MSU.

If the companies don’t pay, that would leave the University on the hook for legal bills fromm the Larry Nassar scandal plus the $500 million it must pay to survivors.

According to the lawsuit: “For example, United Educators, an insurer providing 17 years of primary and excess general liability coverage to MSU, actively promoted its policies’ coverage of the types of claims at issue in this case, stating in policy ‘Coverage Highlights’ that its policies cover ‘vicarious liability for sexual or physical abuse or molestation’ and noting on its website that it added personal injury coverage for sexual harassment claims to its general liability policies in 1999 ‘recognizing that this would have [UE’s general liability policies] encompass the sexual assault-related nature of Title IX claims.”

The suit says it’s not just that the insurance companies won’t pay, but they believe MSU has no legitimate claim.

“The defendent insurers have not acknowledged their contractual coverage obligations, they have refused to acknowledge even the potential for coverage under their respective policies,” the suit says.

6-News placed a call and sent an e-mail to United Educators, though the news about the lawsuit broke after the business had closed for the day on Thursday.

United Educators is the same company that has yet to pay the victim of an accident at MSU more than $7 million, even though the original judgment happened a year ago and several judges at several levels have ordered the company to pay. UE did not respond to 6 News’ questions about that incident.

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