Insurer exodus results in ‘confidential’ state abuse claim indemnities – report

State governments are giving tax-granted indemnities to church bodies for child abuse claims following insurer exits from the market, The Guardian has reported.

Queensland’s state government alone has made temporary deals with 18 organisations involved in youth homeless services and home care, The Guardian reported, with the indemnities intended to trigger when institutions are unable to cover claims costs. The deals were said to expire in September and apply to services funded by the government.

Reforms that saw a time limit for survivors to seek justice removed in 2021 have been blamed for a mass exodus of insurers from the market, with reports suggesting that an influx of child abuse claims followed their inception.

Queensland’s Minister for Children Leanne Linard told The Guardian that the lack of insurance availability is a “national issue” and the state is working with other states and territories on a “range of options”.

The deals are confidential, with payout terms kept secret, it was reported.

“Without [physical and sexual abuse] coverage many child protection and youth homelessness service providers would be exposed to uninsured claims,” Linard told The Guardian. “If claims are made that providers are unable to meet they may be forced to shut down, which would severely affect service delivery to vulnerable children and families.”

Abuse survivors and survivor groups have queried whether taxpayers’ funds should be used to fund such claims, questioning whether this is driving a lack of accountability for church bodies involved, according to the report.

“Surely this should be the moral, financial and legal responsibility of the institution under whose watch children were harmed?” The Blue Knot Foundation president, Cathy Kezelman, told The Guardian. “Arguably taxpayers would be concerned that their money is being used to enable a powerful institution to effectively abrogate its responsibilities.”

Kezelman further questioned the secretive nature of the agreements, The Guardian reported.

Beyond Abuse chief executive Steve Fisher told the Guardian church bodies were “basically holding the government to ransom”.

“If they can’t get insurance, that’s their problem,” he said. “Use some of the hundreds of millions that they’ve got in the bank to pay these claims.”

Adult survivors of abuse in Australia can contact The Blue Knot helpline for support on 1300 657 380

This service operates from 9am-5pm AEST/AEDT 7 days a week including public holidays. They can also email [email protected].