As pastors and church leaders, we have the responsibility of being sure our church is protected from all possible risks. This can be an overwhelming task, especially if we do not understand the insurance market with all the different types of coverages we hear discussed and maybe even suggested we need.
How do we know our church and property are protected properly? First, we need to be sure we have an agent who is very knowledgeable in church insurance. I recently heard of a large church congregation who had added a gym to their campus. As an agent looked over their policy it was discovered the gym had not been added to the church’s policy. This could have had a devastating effect if there had been a fire, storm, or an accident in the gym. Property and Casualty insurance is expensive, so you want to be sure your dollars are covering all your risks. Have your policy re-evaluated every few years to be sure there have not been changes in your church exposure that could have been missed, leaving unexpected risks.
The types and amount of coverage needed will vary with each church facility; also, states have varying requirements. This is why having an agent who understands church insurance is so important.
Property and Casualty insurance is usually offered as a package that includes several policies. Your package should start with:
- Property Insurance – covers the things you own
- General Liability – covers injuries, costs for litigation, etc.
- Coverage for Sexual Misconduct
- Umbrella – sits on top of the other policies
Policy needs vary depending on specific churches and what services they offer. Do you have the option for members to pay tithes and give offerings online? Do you have Wi-fi in your church facility? If so, Cyber insurance is a necessity in case your computer system is hacked and bank account or other financial information is stolen. Do you have insurance to protect your church if the pastor, Sunday school teacher, or a member is accused of inappropriate contact with a child or another attendee? An accusation does not have to be substantiated to cause damage—both financially and to the reputation of a church, especially in the event of a lawsuit. What about church vans and other vehicles? Do you pick up children for Sunday school or transport youth to activities? One lawsuit could devastate the finances of a church if the church is not correctly insured. What if the pastor is sued because someone he was counseling committed suicide or was involved in a crime? This can devastate not only the pastor but the church also. Having the correct insurance in place can protect both financially.
What can you do to lessen your loss risk? Many churches already do this, but if yours does not, it is advisable to run a background check on all staff and volunteers. This may seem extreme to smaller churches, but in today’s litigious society, lawsuits happen too often. Sadly, so do inappropriate actions by adults in authority. Some insurance companies give discounts to churches when they take precautions to lessen risks and this is one that can be done without too much expense. Another way to help protect the church is to keep up-to-date driving records on all who drive church owned vehicles and, of course, have a church policy that someone with a bad driving record is not allowed to drive a church vehicle. Another way to protect against theft is to have a policy that when there is money involved, such as tithes and offerings, always having two people responsible for counting the money and locking it away until deposited.
Another way in which loss prevention can be improved in many churches is by keeping maintenance up-to-date. It is not good to allow a leaking roof go without repair in hopes of having a storm so you can collect insurance funds to cover the cost of replacing the roof or making repairs to it. Several years ago a company looked at the UPCI churches they insured. The loss ratio was 125%. This means that of the premiums they took in, they paid out 125% in claims. One reason claims were so high is churches delayed repairs waiting for a natural disaster to cause damage so they could make a claim and have the insurance company pay for the needed repairs.
Early 2020, United Insurance Solutions, Inc., will be offering group Property and Casualty insurance. This will be available in all fifty US states. As soon as this group policy is available, information will be posted on our website, unitedinsurancesolutions.org.
Let’s be good stewards with our churches and facilities and properly protect them from risks.