How to Insure Your Faith-Based Organization
Your faith-based organization is unique in how it serves your community, but do you know how to insure it? Faith-based insurance is specialized and tailored insurance that protects your religious institution from the risks that it can face.
In addition to your congregation, your faith-based organization may have an expanded role such as childcare services, foodbank services, or a drop-in centre for teens, parents, or the unhoused.
Your faith-based insurance coverage needs to protect your religious institution and its property and visitors.
What is faith-based insurance?
Insurance for churches and faith organizations protects you from occurrences such as third-party injuries or property damage, lawsuits, theft, fire, vandalism, abuse, property damage, and cyber attacks.
Religious organizations insurance is customized to suit your religious organization's specific needs.
What organizations need faith-based insurance?
- Churches
- Chapels
- Temples
- Synagogues
- Mosques
- Faith-based organizations with a registered charity status
- Religious orders
- Monasteries
- Any type of place of worship
How much does faith-based insurance cost?
Every faith-based organization is different and provides different services. The cost of an annual faith-based insurance premium usually depends on these factors:
- Your location
- Size of your faith-based organization
- Condition and age of the building and property
- Years of experience as a religious leader or administrator of the property
- How often the place of worship is unoccupied
- The average occupancy rate during services
- Any past insurance claims
- Annual revenue
- Other uses for the building, such as childcare services
What’s in an insurance package for churches and faith organizations?
Commercial property insurance
It provides financial support to replace or repair your place of worship’s office if it is damaged by a flood, fire, or severe weather. It also covers vandalism and theft.
Commercial property insurance also covers the building’s contents such as computers, furniture, tools, equipment, and inventory. Commercial property coverage also extends to protect others’ property that is under your care.
Commercial general liability insurance (CGL)
CGL insurance protects your place of worship from third-party property damage or claims of bodily injury, such as a worshipper who slips and falls on the property and is injured.
If your place of worship were sued, commercial general liability insurance would cover the legal costs to defend the claim in court, as well as costs to cover damages to compensate third parties.
For example, CGL insurance protects your faith-based organization from childcare liabilities such as allegations involving third-party property and third-party injury.
What kind of risks does commercial general liability insurance help cover?
- Injury to a third party who is not your employee
- Damage to someone’s property
- Damage to rented property
- Medical bills if someone is injured
- Legal costs and settlement costs of liability lawsuits filed against you
- Liability lawsuits related to slander and libel
Without CGL insurance, your religious institution would need to pay any claims on its own.
Even if you aren’t sued, CGL coverage provides reimbursement for medical or funeral expenses due to bodily injury or death sustained by an accident under the conditions specified in the policy.
Cyber liability insurance
Do you keep any parishioner/client information online? Do you take any online payments? If so, your religious institution could be hacked by cyberthieves. Cyber liability insurance will help protect you financially from a cyber-attack.
Abuse insurance
It provides financial protection for your organization, including legal liability, civil and criminal defense costs.
Professional liability insurance
This type of insurance is also called errors and omissions insurance. It helps cover claims against professional negligence, errors/mistakes, or failure to deliver a professional service. For example, if a client weren’t satisfied with the quality of the services provided at your religious institution provided, it could be held legally liable.
Professional liability insurance can help cover your legal costs and related costs.
Directors and officers liability insurance
Directors and officers liability insurance protects your faith-based organization if it’s a registered non-profit or charity with a board of director. D&O coverage protects board members from lawsuits related to poor decisions, mistakes, or allegations of defamation that leads to a financial loss for your institution.
This type of insurance provides your board members with financial support for legal expenses if they are sued.
This type of insurance typically covers:
- Misleading statements, reporting issues, inaccurate disclosure
- Negligent acts and allegations of misrepresentation
- Breach of legal or fiduciary duties
- Decisions that result in adverse financial consequences for shareholders
- Wrongful dismissal and employee discrimination claims
- Failure to adhere to federal and provincial laws and regulations
Employee practices liability insurance
This type of coverage protects you as an employer if an employee claims your church, synagogue, mosque, or temple has discrimination practices, poor practices at your place of worship, wrongful termination, harassment, or engages in sexual misconduct, and other employment-related issues.
Commercial crime insurance
If your faith-based organization handles financial donations or has valuable items, consider adding commercial crime coverage to insurance package to protect it from internal theft, forgery, and fraud.
Ask your Western Financial group business insurance expert to help you get the right faith-based coverage at the right value to protect your church, synagogue, mosque, temple, or other place of worship.
