Is Executive Liability Insurance for Churches Necessary?
In a previous post we explored 3 key benefits of insurance for churches, with one of these benefits being protection for the personal liability of church leaders, or directors and officers. Directors and Officers (D&O) is a coverage that is offered by Executive Liability Insurance for Churches. The most important thing to remember about this coverage is that it is not the same as General Liability. In the event of certain financial damages or lawsuits, D&O insurance will provide legal defense funds and help protect church board members’ personal assets.
Often times, a church board’s state may have legislation protecting nonprofit directors and officers from lawsuits. However, this does not mean that your clients don’t need D&O coverage. In some cases, the statutes specify activities for which immunity is intended. It is entirely possible that a covered claim could fall outside the protection intended by the statute. If state laws don’t protect your client, and they don’t carry D&O insurance, then a successful lawsuit could mean costly claims for financial damages that they could be held personally liable for.
Directors and Officers insurance is not the only type of liability insurance for churches that your clients should be concerned with. Another type of Executive Liability Insurance is Employment Practices Liability Insurance, or EPLI. Sources from Church Law & Tax claim that their research reveals employment disputes are one of the most common sources of litigation for churches. Many churches, however, are not insured against this risk, often based on the assumption that their general liability insurance, or even their D&O coverage, will cover it.
At Charity First, we are dedicated to helping you and your clients find the most comprehensive coverage available for liability insurance for churches. We understand that religious institutions are not only a place of worship, but also serve as the anchor for many individuals and families throughout the community, which is why they need specialized coverage. Please contact us today to learn more about our products at (800) 352-2761.