Property, casualty insurance rates drop in 2010



e-Review Florida United Methodist News Service
      
 

Property, casualty insurance rates drop in 2010

By Erik J. Alsgaard | Jan. 13, 2010 {1120}

LAKELAND — Property and casualty insurance rates for Florida Conference United Methodist churches are decreasing again this year, good news in an economy that’s struggling to rebound.

Graphic by Greg Moore.

The total overall cost of insurance premiums allocated in 2010 to the more than 750 churches in the conference will decrease nearly $1.4 million from 2009 numbers, according to Mickey Wilson, conference treasurer, and Mark Thomas, director of Ministry Protection.

“Overall program costs will be reduced by approximately 10 percent from last year,” Thomas said. “Since 2007, local churches in the Florida Conference have seen their property and casualty insurance premiums decrease by more than 35 percent, which is in direct contrast to the instability and uncertainty that typically surrounds property insurance in Florida.”

The Rev. Steve Price agrees this “third consecutive annual premium decrease is great news” for conference churches. Price chairs the Ministry Protection committee and is co-pastor at Harvest United Methodist Church in Bradenton. “This reflects the committee’s commitment to providing financial relief to congregations across the Florida Conference while not only maintaining, but in fact improving, the quality of coverage for the coming year,” he said.

Graphic by Greg Moore.

Thomas said the 10 percent decrease will not be felt across the board, however. If churches have added buildings, purchased additional vehicles or increased the value of their property, for example, their individual rates may vary. “We treat every church on an individual basis, using the numbers they provide us,” Thomas said. “The overall program costs, however, will be going down again.”

Thomas and Wilson say the unprecedented and continued decrease in premiums is not simply the result of Florida being spared any major hurricanes since 2005.

“We have squeezed all the premium reductions we can out of the property insurers,” Wilson said. “This means we had to look for other innovative ways to control costs, while providing quality coverage.”  

The committee reviewed multiple proposals to restructure the program, resulting in higher self-insured retention limits for coverage other than property, such as general liability and automobile liability. Lower premiums for conference churches are a direct result of those higher self-insurance levels.

As part of the program restructure, the conference retained the services of Aon Risk Management Services to provide broker expertise and support for the insurance program. Aon replaced Arthur J. Gallagher Risk Management Services, which served the conference faithfully for 14 years, Wilson said.   

Aon was able to access a variety of global insurance markets to piece together the most favorable program possible, both from a premium and coverage standpoint, Thomas said. “Aon is the number-one U.S. and worldwide insurance brokerage firm,” he said. “Their expertise and connections within global insurance markets proved invaluable in the restructuring of the program, which resulted in lower premiums for our churches with truly unparalleled coverage.” 

Through the change in brokers, Ministry Protection also gains access to the state-of-the-art Risk Management Information System program, giving the department unprecedented capabilities in information management, claims and litigation analysis, and recordkeeping.

The conference also hired Sigma Actuarial Consulting Services to perform an independent analysis of the financial stability of the insurance program, in addition to a semi-annual actuarial analysis. Sigma completed its review in December and submitted what Thomas considers a very favorable five-year “strategic risk analysis” to the Ministry Protection committee. 

“The conference strives to be the recognized leader in not only United Methodist insurance coverage, but for all church related insurance programs, regardless of denomination,” Thomas said. “These enhancements represent continued steps in that direction.”

Good stewardship goes beyond premium reductions, Thomas added. “The committee has worked diligently in this regard,” he said, “approving increased limits for property, liability, flood, automobile, crime and sexual abuse coverage.” Thomas says this year the committee will also actively consider implementing a deductible assistance grant program to help churches that are not able to afford their deductible after a loss. 

Staffing needs within the Ministry Protection department itself are also continuously evaluated, in keeping with good stewardship. During the past year, the department was able to reduce its staff by one position, Thomas said, while continuing to effectively manage the program and provide high levels of expertise and resources to local churches.

“As the Ministry Protection department has been diligent in fulfilling its responsibility for securing excellent coverage for all our churches, I encourage our congregations to be diligent in fulfilling the responsibility to meet their premiums for this coverage, which will help ensure the program’s success in the future,” Price said.

News media contact: Tita Parham, 800-282-8011, tparham@flumc.org, Orlando

*Parham is managing editor of e-Review Florida United Methodist News Service.
**Alsgaard is director of communications for the Florida Conference.




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