Finance and Administration
For Things Done and Left Undone
It’s early on a Sunday morning in February. Fresh snow has fallen overnight and the streets are slippery. The church parking lot hasn’t been plowed, and the sexton is trying to shovel the sidewalk in front of the church in time for the 8:00 am service. Mr. Johnson, one of your octogenarian parishioners, is picking his way along the sidewalk, aided by his granddaughter. Suddenly he trips on an uneven patch of brick that’s hidden by snow. Down he goes, and he can’t get up. 911 is called, the paramedics arrive, and Mr. Johnson is transported to the local emergency room. His granddaughter texts you to say he has broken his hip and been admitted to the hospital.
So, is your liability insurance up to date?
Since 1929, The Church Insurance Companies have provided the broadest property and liability insurance available to Episcopal churches and institutions, representing the best interests of the Episcopal Church at times of loss. Today, we serve 90 Episcopal dioceses and more than 6,000 Episcopal churches with customizable policies that offer more protection, such as flood coverage and other unique features not available from other insurers, and usually at lower costs.
We recommend that every church carry a base of at least $1M of general liability, which covers injuries to other people sustained on church property. It also covers property damage that you as the insured may have caused.
CIAC’s liability coverage also includes some unique forms of liability coverage not found in the typical business insurance policy. These include:
- Counseling liability for the spiritual counseling done by clergy
- Cemetery liability, which also includes some property coverage for headstones or columbaria that may be damaged by vandalism
- Sexual misconduct liability, which provides coverage for the non-perpetrator and the cost of legal defense for the church or institution
- Employee benefits liability, which provides coverage for errors and omissions in administering your employee benefits program
- Hired and non-owned auto liability, which covers the church itself when renting a vehicle or using a non-owned vehicle for a church-sponsored activity. (This coverage is excess over the primary auto insurance policy on the vehicle).
Directors and Officers coverage protects the church against civil liability for acts, errors, omissions, misstatements, misleading statements, neglect, or breach of duty. In short, it protects the individual vestry members for decisions they make on behalf of the church.
Employment Practices Liability insurance covers allegations of wrongful termination, discrimination, and sexual harassment.
If you have a school associated with your church or diocese, a CIAC policy does include Educator’s Legal Liability, which is professional insurance for claims involving your teachers and the education they are providing.
Workers Compensation is statutory coverage that provides a partial salary and medical benefits to any employee injured while performing his or her duties. By law, coverage for clergy may be optional, but we recommend you do purchase this important coverage for your clergy as well.
We recommend that any automobile owned by a diocese, church, or church organization carry insurance with a policy limit of at least $1 million. CIAC offers an umbrella policy starting at $1 million, but others may not. So make sure your auto policy tracks with your umbrella policy. In other words, an umbrella policy, which covers auto use as well as other covered events, is excess and sits above your primary policy. If there is a coverage gap between the limit of the regular auto policy and the level at which the umbrella policy picks up coverage, the church would have to pay the cost of “the gap.”
Umbrella coverage requires an additional premium payment but is typically affordable. It provides a safety net of additional liability coverage. Umbrella coverage limits typically range from $1 million to $10 million. While we cannot tell you how much coverage to buy, you should be aware that churches with owned vehicles or an associated school will pay a higher premium and therefore should be among those who consider insuring to higher limits due to the higher risk of loss.
If church members are temporarily traveling out of the country, it is a good idea to purchase international travel coverage for unexpected medical costs. Premiums are as little as $10 per day.
Mr. Johnson is on the mend. His family members have not yet suggested the church was at fault—but if they do, the cost to the church could be significant without liability coverage.
A number of booklets and resources — including seasonal checklists to use in protecting your church property inside and outside — are available at https://www.cpg.org/administrators/insurance/property-and-casualty/risk-management/risk-management-materials/
If you represent an Episcopal church or institution, we are available to speak with you at any time, whether or not you are insured through CIAC. For risk management advice or insurance services, please call us at 800.293.3525. And please visit us at www.churchinsuranceagency.org where other resources are available.
Steven Follos is vice president and manager, The Church Insurance Agency Corporation. He
has dedicated his career to the protection of the parishes, dioceses, and other institutions of The Episcopal Church. He has 23 years of experience insuring religious organizations, 18 of them with the Church Pension Group.
At CPG, Steven is responsible for leading The Church Insurance Agency, which serves more than 7,000 and extension ministries.
 Collectively, The Church Insurance Agency Corporation, The Church Insurance Company, The Church Insurance Company of New York, and The Church Insurance Company of Vermont
Try This: Does your congregation have a schedule for monitoring, reviewing, and adjusting potential areas of liability? Is it followed? If not, what steps might you take to create a new plan or begin to implement your existing program?
- A number of booklets on specific topics such as stained glass, outside contractors, fine arts appraisals, and owned vehicles, as well as numerous checklists and tips, are available at https://www.cpg.org/administrators/insurance/property-and-casualty/risk-management/risk-management-materials/
- The Good Steward e-newsletter offers articles and tips on how to reduce the risk of and address problems
Church Pension Group ("CPG") is a trade name under which The Church Pension Fund and its affiliates serve the needs of the Episcopal Church community and does not, itself, issue insurance policies. The Church Insurance Companies provide property and casualty insurance and reinsurance coverage and other related services for various property and casualty risks for the Episcopal Church and its provinces, dioceses, parishes, missions, agencies, institutions and other entities.
Property and casualty insurance products are underwritten by The Church Insurance Company of Vermont, a Vermont domiciliary with its home office located at 210 South Street, Bennington, VT 05201, The Church Insurance Company of New York, a New York domiciliary, located at 19 East 34th Street, New York, NY10016, and by other companies (not affiliated with CPG) for which The Church Insurance Agency Corporation, itself a member of CPG, acts as an insurance agent or broker.
Coverage options and exclusions, and policy availability may vary by state and geographical area. The Church Insurance Companies are not licensed in all states. Information and descriptions of policies and services are provided solely for general informational purposes and are not intended to be complete descriptions and does not create a contract or an offer of coverage. For complete details of coverage, including exclusions, limitations and restrictions, the actual policy or certificate should be consulted.
Information provided herein is not intended to constitute an offer to sell, nor is it a solicitation for, any product or service offered by The Church Insurance Companies or other unaffiliated insurers. Neither CPG nor The Church Insurance Companies guarantees the performance of the legal and contractual obligations of any unaffiliated insurer.