By Luke Shipp, First Insurance Group
Over the years, the market landscape and offerings for houses of worship has changed significantly. Have you found yourself facing different options year in and year out? If so, you aren’t alone. Know that consistency with the same carrier can yield a lower cost over a long period of time rather than switching each year for the newest or cheapest deal. My goal is to provide you with information that can reduce your risk and in turn, hopefully lower your cost. Below is a breakdown of key items on a coverage item by coverage item basis.
Property Insurance
Property insurance rate expectations for houses of worship on an annualized basis can be 10% or greater depending on your individual experience. Knowing that this portion of most programs represents anywhere from 50% to 80% of cost, it’s important to understand what carriers look for. Below are some items that can help you in the negotiation with your agent and or carrier:
- Roof Updates – this is a primary focus for carriers. Having your roof updated in the last 10 years increases the desirability and can offer discounts. If the roof has not been updated, sharing your maintenance plan or any upcoming work can benefit you in your discussion.
- Proper Security Systems in Place – this can include Central Station alarms and camera systems with recording capability. Some carriers offer discounts for individual systems; it never hurts to ask.
- Recent Upgrades to Your Mechanicals – carriers often want to know the last time your furnace, boiler or air conditioning was upgraded.
General Liability
Several houses of worship carry Medical Payments coverage in their program. This can be a loss leader for the insurance industry. This coverage will pay for injuries, regardless of you being negligent in causing those injuries.
- An example – a member of your congregation slips and falls on your property. You did nothing wrong but have coverage that can provide up to $10,000 of medical payments for that individual.
Removing this can yield a savings and reduce your overall experience with a carrier – providing a lower cost over a period of time.
Cyber Liability
This is a growing concern across all areas of the insurance industry. It’s seeing the greatest increase in cost on a year-over-year basis. Five years ago, the worry was the theft of personal information for members of the congregation, volunteers or employees. Today, it is the lockdown of systems (ransomware) or theft of money through tricking you into sending you to someone you thought was a legitimate source (Social Engineering or funds transfer fraud). Regardless, if this is a coverage you have not considered in the past, please ask your agent and or carrier about their offerings. Cyber concern has been rated the #1 concern by Fortune 100 companies for the last 2 years and has ranked in the top 5 for the last 5 years.
Other Various Items
- Professional Liability – while not every carrier offers this coverage, if you are providing counseling on a regular basis as licensed professional, it is strongly encouraged to consider.
- Employment Practices Liability – for those houses of worship with more than one employee. This would provide coverage for discrimination, harassment and other items through the course of employment or pre-employment. If you carry this coverage already, please verify that it includes 3rd Party Liability as well.
- Auto Coverage – if this pertains to you and your house of worship. This is the other area that is seeing large increases in the 8%-10% range year over year. Some things you can do to better prepare is have a driver safety plan, regularly review Motor Vehicle Reports for all drivers and verify that anyone using their personal insurance has coverage in place before driving for your institution.
This is a brief overview of the industry and some insight on each coverage line that may pertain to you. While insurance is not exciting, understanding the information your agent and or carrier is looking for can help to streamline the process and better prepare you to protect your future.