Churches have become progressively susceptible to lawsuits and claims. Whether the allegations are true or not is irrelevant when it comes to defending your church against a claim. Legal fees, defense costs, and payment for damages are enough to financially ruin any business, let alone a non-profit organization such as your church.
In addition to financially protecting your establishment with the right type of church insurance policy, it’s important to have a risk management strategy in place as well. Church leaders are encouraged to recognize that risk management is an inherent part of organizational oversight and leadership. The problem tends to be that church leaders often don’t know what proper risk management looks like, nor do they know whose responsibility it is.
An effective church insurance risk management plan is one that addresses risk in all aspects of the churches activities. Risk management plans should be proactive rather than reactive, identifying risks before they become liabilities. The church board may wish to establish a standing risk management committee to oversee the risk management strategies of the church, and to provide reports and recommendations to the full board.
It’s important to remember that reducing risk by implementing preventive measures is different from obtaining church insurance. Risk management is only a part of an overall church insurance program. With this in mind, it’s important that your church board ensures that your organization maintains adequate insurance coverage with respect to applicable risk areas.
Some key risks that warrant attention in the church environment include, but are not limited to, the following.
- Corporate structure
- Governing documents
- Policy manuals
- Tax-exempt status and compliance
- Financial condition and financial controls
- Adequacy of insurance coverage
- Human Resources
- Child Molestation
- Key operational areas
- Public relations
- Physical health and safety
At Sinclair Risk & Financial Management, we offer the Risk Safeguard Advantage, which is a system born out of a philosophy that combines uncommon risk analysis and strategic risk management with Human Resources Consulting and training to provide measurable, sustainable results. Please contact us today at (877) 602-2305 to learn more about how our risk management strategies will fit into your church insurance program.