Horace Mann is seeking $1.05 million in a recently filed lawsuit against three subsidiaries of the insurance giant American International Group [AIG], claiming breech of contract in their handling of sexual abuse claims against the school.
The suit accuses Granite State Insurance Company, New Hampshire Insurance Company and Chartis Claims, Inc. of failing to promptly notify the school it was denying Horace Mann coverage and, consequently, wrongfully neglecting to defend and compensate the school.
“In gross disregard of their insured’s interests, defendants breached the duty of good faith and fair dealing by repeatedly, intentionally and wrongfully placing their own interests ahead of their insured’s interests,” the suit read.
Horace Mann held four insurance policies with the insurers that collectively covered $8 million of liability for bodily injury, including from sexual abuse, between June 1992 and 1996.
Alumni began filing lawsuits against Horace Mann following the June 2012 publication of alumnus Amos Kamil’s expose on sexual abuse at the school.
A group of alumni then formed the Horace Mann Action Coalition to assist victims and push for an independent investigation. The group commissioned a probe in late April.
Since then, coalition archivist Peter Brooks said the organization has deemed credible reports that 22 former teachers abused 62 former pupils between 1962 and 1998. The group says that at least 12 administrators, including five headmasters, were aware of abuse and that the school failed to refer at least 20 reports of misconduct to authorities.
School officials said they notified their insurance companies that an attorney representing the allegedly abused former students contacted them in July. The suit notes that Horace Mann contacted the insurers several times about two claimants that fell under its policies, but six months passed until a denial notice was received, which the school’s lawyers argue violated an insurance law obligating companies to issue responses as soon as possible.