Insurance giant AIG has agreed to a $78.8 million settlement with the Los Angeles Unified School District over claims of toxic pollution at school sites.
In documents obtained by the Los Angeles Times, L.A. Unified alleged that AIG collected millions of dollars in premiums from the school district without intending to pay off all claims for cleanup at polluted school construction sites.
The school district board paid $7.5 million up front for the $100 million insurance policy as it ramped up a massive school construction effort 12 years ago. Claims quickly surpassed $100 million and LAUSD took AIG to court six years ago in an effort to make the insurance giant pay them.
AIG claims in the documents that in an effort to use the AIG policy as a subsidy to clean up the sites, LAUSD withheld information about just how toxic some school sites were.