Michigan State University is finding it difficult to pay the settlement amount to victims of 54-year-old Larry Nassar, a former MSU and USA Gymnastics physician, as it alleges insurance companies of “failing to honor their policies.”
The university on Thursday filed a lawsuit against all its insurance carriers regarding the policies and coverage for sexual assault claims.
“We are suing our carriers, including our largest carrier United Educators, for failing to honor their policies,” said Robert Young, general counsel for the 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 a speedy resolution and that the insurance companies will honor their contractual obligations,” he added.
The university had in May agreed to settle the lawsuit by paying $500 million to 332 victims of sexual abuse by Nassar, who was sentenced to 40-175 years in prison after he was found guilty of three child pornography charges and 10 sexual assault charges. He is serving his sentence at the United States Penitentiary in Tuscon, Arizona.
The terms of settlement included $425 million to be paid to current claimants and $75 million to be set aside in a trust fund to protect any future claimants alleging sexual abuse by the physician.
Meanwhile, on Wednesday, the survivors of sexual abuse, their parents, and MSU community members joined curators from university’s museum to begin the process of preserving the more than 200 teal mesh bows, serving as a visual memorial to honor the survivors wrapped around trees across the campus.