In 2011, the Vienna Presbyterian Church in Vienna, Virginia, chose to apologize to the victims of abuse at the hands of a church employee. The story was spoke about here on a past thread.
The church chose to apologize in spite of that decision affecting whether or not the insurance policy would cover the abuse payout.
The following pdf discusses how that church's decision would have been influenced by the insurance company:
Most churches have a Commercial General Liability insurance policy (CGL) that provides coverage for injuries that occur in or related to church programming. Virtually every CGL policy requires that the church give notice to the insurer as soon as the church has information about an event that may trigger a claim. Because church leaders often misunderstand, minimize and ignore warning signs and victim outcries, they also fail to notify the insurance carrier, which can easily lead to denial of coverage. In addition to the CGL reporting requirement, there is also a cooperation clause that requires an insured church to participate in the defense of a potential claim and to do nothing that would be detrimental to an insurance company’s attempt to defend a claim.
When church leaders provide ‘notice of a potential claim’ relating to child sexual abuse, insurance companies take them very seriously. Insurance companies understand that child sexual abuse claims are very dangerous: there are often multiple victims, they are expensive to defend, they are emotionally charged and the jury awards/settlement amounts can be unpredictably high. Insurance companies understand that HOW a church handles the matter can seriously impact exposure, costs and awards (i.e. perception of a cover-up or an admission of responsibility). When an insurer receives a notice of a potential claim, the insurer will usually engage legal counsel for the insured church. The lawyer engaged by the insurance company for the church is in the uncomfortable position of owing a fiduciary duty to the insured church, while being paid by the insurance company to defend the claim.
The stage is now set for the church to make a very difficult decision – a decision that will have serious potential consequences no matter what direction is chosen. This is further complicated when the church has ignored or mishandled earlier outcries. The victims and the congregation want to know that church leaders will be transparent and pastoral – they want to know if leadership has mishandled a matter and, if so, to apologize and seek forgiveness. After all, they are shepherds who are supposed to model ownership of failures.
To make such an admission, however, would create serious risks in a civil lawsuit and insurance coverage related to the claims in the suit. Admitting responsibility for failing to sufficiently screen an employee or mishandling a prior outcry forms the basis of a negligence claim. This is exactly the type of admission a plaintiff’s lawyer would rely upon to make his/her case; and the insurance company knows that. Insurance companies will therefore clearly communicate to church leaders that the CGL policy strictly prohibits such admissions for poor screening/supervision or failed handling of an outcry, as doing so can jeopardize insurance coverage.
Unfortunately, these are usually the exact types of expressions that victims need to hear so they can heal and forgive.
And unfortunately, in the sex abuse cases now facing the WTS...when it comes to the WTS making any decisions to apologize instead of pretending they are not accountable...money is first and foremost. If the WTS admitted culpability, their insurance policies would probably not cover the payouts.