Zurich, Philadelphia, Others Ordered to Pay $345M to Cover Abuse Charges at Georgia School

Five insurance companies have been ordered to pay $345 million to cover damages awarded to 20 men who said they were victims of sexual abuse at a prestigious boarding school in Georgia in the 1970s and 1980s.

Floyd County Superior Court Judge Adele Grubbs decided Tuesday that liability insurance policies for Darlington School, in Rome, Georgia, covered the actions of a former teacher and dorm supervisor, according to court documents and local news reports. The insurers had asked the judge to find that the policies excluded the alleged abuse and that the statute of limitations barred the civil suit.

The summary judgment orders Philadelphia Indemnity Insurance Co. to pay the lion’s share – $232 million. Zurich American should cover $92 million. North River Insurance and Great American both owe $10 million, and Continental Casualty Co. should pay $1 million, the judge decided.

Zurich officials declined to comment Wednesday morning. A lawyer for Philadelphia Indemnity told the Atlanta Journal-Constitution newspaper that the company plans to appeal. Interest began accruing this week, the newspaper noted.

The 20 former students sued 10 of the school’s insurance carriers in 2022, after the men settled lawsuits against the school and the former teacher, Roger Stifflemire, for more than $350 million, according to news reports. Stifflemire, now 83 and living in Alabama, was covered under the school’s liability policies in place at the time of the alleged abuse, one of the victims’ attorneys has said.

Stifflemire has not acknowledged the alleged abuse but has cooperated with investigations, his lawyer said in 2022. The complaint against the insurers can be seen here and Zurich’s answer is here.

The allegations began to surface in 2017 in articles by the Atlanta newspaper, which alleged that school officials had been made aware of the alleged abuse decades before. Darlington School investigated but the findings were not made public, the AJC reported. The school, founded in 1905, issued a statement saying current policies focus on respecting boundaries and on training and reporting procedures for students and faculty.

The victims were aided by a state law, the Hidden Predator Act, passed in 2015, the Rome News-Tribune reported. The law essentially extended the statute of limitations for abuse victims for another two years.

The $345 million judgment, if allowed to stand by appeals courts, would be one of the larger amounts faced by insurers in recent years – but not the largest. Juries in the last decade have awarded more than $1 billion to victims injured or killed in auto and truck accidents, rape cases and other personal injury litigation.

Zurich, citing the Institute for Legal Reform studies, has noted that four states, Florida, Texas, California and New York have accounted for 60% of the so-called “nuclear verdicts” – $10 million or more – in the U.S. between 2009 and 2022.

Correction: A headline on an earlier version of this article referred to Philadelphia Indemnity Insurance Co. by an incorrect name.

From 2022: Former Students Sue Insurers Over Alleged Abuse at Georgia Boarding School