|Florida churches enjoy drop in insurance
A Sunday school room at White City
(Fla.) United Methodist Church was damaged by Hurricane
Frances in 2004. Such storms caused Florida churches to
experience skyrocketing insurance rates in 2006, but the
2008 outlook is significantly brighter.
A UMNS file
photo by Michael Wacht.
By Erik J. Alsgaard*
Jan. 17, 2008 |
LAKELAND, Fla. (UMNS)
United Methodist churches in hurricane-prone Florida began
2008 with good news: a 22 percent decrease in the cost of
property and casualty insurance premiums.
Compared with 2007, the total cost of
premiums is expected to decrease by $4.1 million to about $15
million for the 750 churches in the Florida Annual (regional)
Conference, according to Mickey Wilson, conference treasurer,
and Mark Thomas, director of the Florida Conference Ministry
"The exact percentage will vary
from church to church," Thomas said. "It all depends on
variables such as if the church purchased a new fleet of
vehicles, increased the value of its buildings or built new
facilities—things like that."
Protection office and committee leaders worked closely with
Arthur J. Gallagher Risk Management Services, the conference’s
insurance broker, to develop the coverage package. The company
solicited more than 35 quotes.
"I am very pleased to
see our premiums drop after so many 'up' years," said Roger
Bond, chairman of the Ministry Protection committee. "A 22
percent drop is great, and that’s been done with a 33 percent
increase in property coverage and other positive
Across the United States, United Methodist churches obtain
insurance coverage individually, through conference packages
such as Florida's or increasingly through the 3-year-old
United Methodist Property and Casualty Trust, a nonprofit
company insuring approximately 5,000 churches in 19 annual
The trend is toward churches joining
together to spread their risks across jurisdictional lines and
even ecumenically, according to Irene Howard, PACT's chief
"The law of large numbers really
does work better with large numbers," said Howard. "The more
of us that come together, the more risk we're able to assume
and the cheaper insurance becomes.
conference experienced record-high premiums in the wake of
Hurricanes Charley, Jeanne, Frances and Wilma in 2004-05, but
now it is enjoying a market correction following several years
of moderate weather, according to Thomas.
conference's mandatory insurance program began in 1995 to help
churches obtain coverage after Hurricane Andrew devastated
parts of southern Florida in 1992. "The program as it stands
now is truly tried and true," Thomas said. "We've gotten all
the churches into it and also gone through a series of storms.
We've been hit from all angles, and it is really working for
the Florida Conference."
The recent decrease in
premiums is good news on many fronts. Not only will the
overall premium cost go down, the level of coverage will
"For named storms, our coverage will increase
from $46 million to $76 million," Wilson said. "For flood
coverage, the total goes up from $10 million to $25 million.
And the deductible for flood claims decreases from $25,000 to
The coverage per incident for sexual
misconduct and molestation also increases, from $5 million to
With the exception of 15-passenger vans,
Thomas said insurance costs for vehicles remain the same—the
fifth consecutive year with no increase.
The claims-handling process also will improve in Florida,
Wilson said. "In 2008, we will deal with one insurance
carrier. In 2007, we had two, and in 2004 and 2005, when we
had all those storms, we had four. It made for a real mess in
trying to figure out which claim went to which carrier. We’ve
eliminated that. One carrier, one claim, one call."
the Florida Conference began a loss prevention and safety
program that offers local churches an insurance and safety
audit. Thomas and representatives from Arthur J. Gallagher
evaluate church buildings and grounds, looking for ways to
prevent claims before they happen.
One-hundred percent of United Methodist
churches in Florida are insured in three key areas,
while most elsewhere in the United States are not. A
UMNS illustration by
The conference also
is working actively to make sure that local churches
accurately report the value of buildings and vehicles and the
number and salaries of staff members.
In 2008, the
total value of insured property will top $2 billion. The
estimated payroll—which helps determine workers’ compensation
insurance costs—is $170 million, up nearly 18 percent from
2007. That includes salaries for all clergy and staff serving
in the conference. The number of "employees" (for insurance
purposes) is 8,573.
"And for the first time, we sat
down face to face with the insurance carriers and explained
what we’re doing," Wilson said. "They were very interested to
learn all the steps we have in place to keep our risks
*Alsgaard is director of communications for the
Florida Annual Conference. A similar version of this story
appeared in the conference’s e-Review Florida United Methodist
News media contact: Marta Aldrich,
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