Duluth diocese settles with final insurer

The Diocese of Duluth entered into an agreement this week that would end years of litigation over insurance coverage and provide more than $30 million to victims of child sexual abuse.

Liberty Mutual Insurance Company agreed to pay $6.5 million under a settlement agreement filed this week in U.S. Bankruptcy Court. It is the fifth and final insurer to settle with the diocese, which filed suit in 2016 to force coverage of claims in its ongoing bankruptcy.

A committee representing the claimants must still vote on the proposed settlement. Bankruptcy Judge Robert Kressel is expected to approve the agreement at a March 7 hearing, barring any objection.

But officials said the proposed settlement marks an important milestone in the effort to compensate the 125 people who have filed abuse claims and allow the diocese to emerge from bankruptcy protection after more than three years.

“We hope the bankruptcy judge approves the settlement, which depends in part on whether attorneys for the victims have any objections,” said Deacon Kyle Eller, diocese spokesman. “Although there are additional issues for resolution, settlement with the last insurance carrier would mean significant progress toward final resolution and our goal of providing compensation to those who have been hurt as a result of sexual abuse by clergy in our local church.”

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