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New year brings dramatic drop in property, casualty insurance premiums

New year brings dramatic drop in property, casualty insurance premiums

e-Review Florida United Methodist News Service

New year brings dramatic drop in property, casualty insurance premiums

Dec. 20, 2007  News media contact: Tita Parham*
800-282-8011  Orlando {0779}

An e-Review Feature
By Erik J. Alsgaard**

LAKELAND — Churches in the Florida Conference have received an early Christmas present: a significant decrease in the cost of property and casualty insurance premiums for 2008.

The total cost of the 2008 insurance premiums allocated to the more than 750 churches in the conference will decrease 21.7 percent, or more than $4.1 million, from 2007 costs, according to Mickey Wilson, conference treasurer, and Mark Thomas, director of the Florida Conference Ministry Protection department.

“The exact percentage will vary from church to church,” Thomas added. “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.”

In terms of dollars spent on property and casualty insurance premiums, in 2007 the Florida Conference allocated more than $19.2 million. In 2008, that number will be a little more than $15 million.

Thomas said his office spent weeks working closely with Arthur J. Gallagher Risk Management Services, the conference’s insurance broker, and leadership from the conference’s Ministry Protection committee on this year’s premiums. Thomas said Arthur J. Gallagher solicited more than 35 quotes for the insurance package.

“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 benefits.”

The news is good on many fronts. Not only will the overall premium cost go down, the level of coverage will increase.

“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 $5,000.”

The coverage per incident for sexual misconduct and molestation also increases, from $5 million to $10 million.

With the exception of 15-passenger vans, Thomas said insurance costs for vehicles remain the same — the fifth consecutive year with no increase.

Florida Conference churches enjoy the benefits of a well-developed property and casualty insurance program. One hundred percent of Florida Conference churches are insured in three key areas, while nationally, most United Methodist churches are not. Graph by Greg Moore. Photo #07-0720.
The claims handling process will also improve, Wilson said.

“In 2008 we will deal with one insurance carrier,” Wilson said. “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.”

In explaining the decrease, Wilson pointed to several factors, not the least of which was the lack of named storms hitting the state this year.

“Oh certainly, that helped,” Wilson said. “But our being proactive on this issue also helped.”

This year 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.

The conference has also been very active in making sure local churches accurately report the value of buildings and vehicles and number and salaries of staff members.

In 2008 the total value of insured property in the Florida Conference 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) in the Florida Conference in 2008 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 low.”

Thanks to all that hard work, Florida Conference churches will have an extra $4.1 million staying in their churches to do the work of mission and ministry, making disciples of Jesus Christ.

“I love our insurance carriers,” Wilson said. “But I’d much rather have our money going for that than to them.”


This article relates to Florida Conference Insurance Program.

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