The last round of storms that blew through Lubbock has left Pastor Chase scratching his head. What was supposed to be a typical Panhandle Spring hail storm turned into much more. The 80 mph winds had ripped large portions of the roof off the building and allowed a lot of water to damage the interior portions of the sanctuary and education building. This physical damage from this storm meant that his congregation wasn't going to be meeting in their building for quite a while due to the cleanup and reconstruction that is needed. He felt lost wondering what they were going to do while this process played out.
Chase's first phone call was to his church insurance company to start the claims process for the storm. He knew that had to be done either way. While speaking with the intake person, he asked if his church insurance policy had any provisions that would help with this situation. Chase knew he needed a solution to keep the church running smoothly during the repair period. He was hoping that they could help the church find a temporary location and keep its ministries active while the building was being restored. That's when he first learned of Business Interruption Insurance policies.
What Is Business Interruption Insurance?
Business interruption coverage is designed to cover lost income and operating expenses when a covered event, such as a major wind and hail storm, prevents a business or religious organization from operating. For churches, this insurance can cover expenses like revenue from giving, rent, loan payments, taxes, payroll and extra expenses from relocating. This is to make sure that the church can continue its mission and ministries even during difficult times. This could be the lifeline that Chase is looking for.
Importance Of Having Business Interruption Insurance For Churches In Texas
Churches in Texas face unique risks and challenges of many varieties. But weather related issues are one that is not unique, but equally problematic. Given how frequently and violently the weather can shift, having this additional coverage can be a vital safeguard to keeping things running smoothly when damage to church buildings occurs. This insurance provides protection against financial hardship in the event disaster strikes your church. Chase realized that this separate policy would allow them to maintain their operations and services.
When a church building is damaged, whether it is a storm or some other other disaster, it can lose various sources of income and incur extra expenses if you are forced to relocate temporarily. Loss of income can include donations from giving, rental income from people who use your property, tuition fees from schools or daycare programs, service fees, and special event revenue. Business interruption insurance helps bridge these financial gaps, ensuring the church can survive and continue its ministries.
How Business Interruption Insurance Works For Texas Churches
Business interruption insurance for churches in Texas works by covering lost income and operating expenses during the period the building is being repaired from a claimable event to your property. One place that is overlooked is that it can also be used as part of the claim process if you have a cyber insurance claim as well. This coverage includes mortgage payments, loan payments, taxes, payroll, and relocation costs. It allows churches to maintain financial stability and continue their operations without interruption. For Texas churches, this insurance can be a lifeline, providing the necessary funds to keep the church running when physical operations are halted.
Types Of Coverage Provided By Business Interruption Insurance
Business interruption insurance offers various types of coverage including several that we've mentioned. Let's look at some of the specific line items that Chase found appealing when he began to look at what coverage he had.
- Temporary Location Rent or Lease Payments: this will cover your costs to relocate to a new physical location for a period of time.
- Equipment Rental or Replacement: when your church's equipment is destroyed due to hail damage, it may take some time to replace. This will help you find suitable replacements in the interim.
- Employee Payroll: giving often drops during a natural disaster like what Chase experienced. This makes sure that payroll can be met while the pieces are being put back together.
- Extra Expenses: there are often expenses that you have not considered when rebuilding, replacing, moving, or relocating. This will cover those "extra" expenses that occur as part of this process.
- Other Covered Losses: Includes lost income protection and other business operating expenses like rent, loan payments, and even taxes that might be due.
- Contingent Business Interruption Coverage: if you have business income losses due to other people also not being able to use your space due to property damage, this will kick in as another form of income protection.
Getting Business Interruption Coverage For Your Church
Even though you may not see insurance for your church as business insurance, the insurance companies do. That means your church, just like Chase's, can have access to this powerful addition to your church property insurance policy. But it's important to understand whether or not your policy language on your church's commercial insurance policy has business interruption included in it.
To secure business interruption coverage, churches can add it to their basic Business Owners Policy or as a standalone policy with your church's commercial property insurance policy. Working with an experienced church insurance agent is essential to tailor the coverage to the church’s specific needs. This process involves providing documentation and information about the church’s operations, financials, and potential risks. But can be done swiftly and easily when working with the right church insurance agency.
Working With Insurance For Texans To Get Coverage
Insurance For Texans specializes in helping Texas churches protect their future with customized insurance plans using True Texas Church Insurance. By having detailed discussions with our agents, we work to make sure that your church insurance coverage matches the scope of your church’s activities and unique needs. The True Texas Church Insurance program helps identify your church’s unique risks and provides comprehensive coverage with the right insurance company. Our independent agents work for your church and not some big insurance company. Your interests are always our only priority.
Pastor Chase’s experience in Lubbock underscores the importance of having the right insurance coverage and support systems in place. Click the button below to explore options for keeping your ministries active with TRUE Texas Church Insurance, so that your church can continue its mission through any storm.