Tuesday, April 30, 2013

Insuring against crimes

While yesterday’s forthright admissions . . . shed light on the extent of abuse attributed to priests in Ballarat – more than 100 cases – there is a sense that there were further questions about events in Ballarat between the late 1960s and the 1980s which were beyond the scope of direct response yesterday. (1)

One such iceberg that we have barely seen the tip of is the role of the Church-owned insurer, Catholic Church Insurances Ltd (CCI), in shaping the Church’s response, since c.1990,  to historical (pre-1990) instances of child sexual abuse by clergy (2). 

This shaping has not just been financial; CCI has also backed Encompass (3), a residential treatment/“treatment” program, that ran for a decade until 2008, for clerical sexual abusers (and also, it appears from something said at yesterday’s Victorian Parliamentary Inquiry, for non-celibate priests who have sex with consenting adults, at least when both parties were male (4).

Leaving aside, for now, the regrettable – or deliberate? – conflation of gay sex with paedophilia, you may well wonder what sort of a business takes out insurance against crimes committed by its own employees, anyway.  Ever heard of the phrase “moral hazard”?

You may be slightly reassured here by a couple of facts.  The first is that the insurance policy, at least that which covered the Ballarat diocese, was not operating at the time of the actual abuse.  It was retrospective – like getting cover after your place was burgled.  Of course no ordinary insurer would offer such insurance, but CCI was no ordinary insurer.  It was, in essence, the Church shuffling its own money – robbing Peter to rape Paul, if you like.

Also, CCI didn’t write a blank cheque – it covered historical instances of child sexual abuse by clergy only up until 1975 – the latest possible year in which the Bishop of Ballarat, Ronald Mulkearns, became irrefutably aware of at least one diocesan- priest child sexual abuser, Gerald Ridsdale. 

One definitely non-reassuring fact, however, arises from the policy’s fairly hefty excess, of $25,000 (2, again).   Not coincidentally, I would say, the cited average total payout to victims under the policy was $28,000 (ibid) – i.e. the insurance “arm” of the Church fought/negotiated their own contribution so vigorously that it ended up being almost token: an average of $3,000 per victim (the rest was the excess, which presumably came from diocesan coffers).

What was the point of it all then, you well may ask? An elaborate charade is my best guess – putting investigators off track, and interposing a convenient corporate wall when playing hard-ball in payout negotiations.  Oh, and also, more nebulously, lending a retrospective veneer to the sort of “treatment” programs in operation at the height of the abuse epidemic, such as the US program Gerald Ridsdale was sent to c.1976.

If you ask me, it all seems to add up to a retrospective licence for (i) paedophile priests, (ii) their covering-up bishops/bosses, and not to forget here, (iii) those (although it is a class of one in the Ballarat diocese, AFAICT) whose careers strangely prospered betwixt paedophile priests and their covering-up bishops/bosses.

You shouldn’t be surprised that a (deceased) paedophile priest ran the CCI show for quite a while (5).  But personally I don’t think that he, or the still-living Bishop Mulkearns, are the main game in this still mostly-submerged iceberg.

Update 1 May 2013

Yesterday’s Inquiry hearing, at which two CCI rep’s spoke, has clarified some things. 

There are/were actually two types of insurance policy which cover/ed child sexual abuse by clergy:  standard public liability (issued since 1969, but only invoked to cover child sexual abuse since the early 1990s, while the original policy coverage intention would have been more like parishioners slipping on banana peels outside Mass), and “special issues” (which were only issued in the four financial years ending in June 1995, which covered only claims made (not abuse event occurrence) in those respective years, and which were then superseded by the twin ADR schemes, Towards Healing and the Melbourne Response).

Both types of policy had a standard disclaimer, which boils down here to:  Did Church authorities know of that particular abuser’s propensity?  If so, coverage of that abuser’s acts stops at the date of such knowledge; i.e. the Church will be on its own, insurance-wise.  In Ridsdale’s case, this doesn’t mean that insurance claims made after 1975 will fail (as Barney Zwartz incorrectly wrote in yesterday’s Age), but that claims relating to Ridsdale’s conduct after some time in 1975 (the date here is yet to be made public) won’t be paid out by CCI.

Much was made on ABC TV News breakfast this morning about a “list” of 30-odd clergy subject to insurance exclusion dates.  While the disclosure of such a list will be interesting, it is important to remember that this list is an early-1990s (or even later) reconstruction of Bishop Mulkearns' (to use Ridsdale as an example) knowledge-of-propensity in the early/mid 1970s.  It may “prove” certain things, but it certainly won’t provide a complete explanation, nor, still less, will it delve into the more important (IMO) possibilities around earlier knowledge-of-propensity dates.

To cut to the chase here: I’m sure Bishop Mulkearns is quite delighted with the circumstance in which CCI has deemed him with knowledge of Ridsdale’s propensity – a police officer approached him in 1975 regarding Ridsdale’s abuse at Inglewood.  Note that therefore there was nothing Bishop Mulkearns then needed to tell the police about Ridsdale – quite the opposite, in fact.  

As I alluded to in yesterday’s post, there is strong, if circumstantial, evidence that Bishop Mulkearns well knew of Ridsdale’s propensity from his early days of taking up the job (in mid 1971), but that power plays and  machinations then taking place within the Ballarat diocese had him (Bishop Mulkearns) backed into a corner.  And I am quite sure that CCI will not have any record of this – so beware of red herrings/cassocks.    


  1. “The church must deal openly with a very painful history”, Ballarat Courier Editorial April 29, 2013, 9:30 p.m.

  1. Ian Munro “Church insured for abuse claims”, Age July 1, 2002

  1. Richard Baker, Nick McKenzie, “Church holds sex dossiers”, Age November 17, 2012

  1. Bishop Peter Connors at Victorian Parliamentary Inquiry, approx. 4pm, 29 April 2013 (my notes only; verbatim transcript not yet available), in answer to a question from Andrea Coote, “Do you believe that paedophiles can be cured?”:

“No, we used to think this, but this is definitely no longer the case.  As an example of this, I had a priest who committed a homosexual act with an adult man.  I sent him to the Encompass program, and after he finished there, I asked them whether they could give me an assurance that he wouldn’t commit the same act again.  As they couldn’t give me this assurance, I did not return this man to the ministry.”

  1. Carly Crawford, “Abuser priest led Catholic Church insurance scheme”, Herald Sun, April 8, 2013

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