When you are a pastor or a clergy worker, it is important to understand the risks that are connected with your profession. Because there are risks, you need a "risk management plan." A professional liability insurance policy should be a part of that plan. A professional liability insurance policy, also referred to as an "indemnity" policy, is not mandatory for clergy. However, without it, you put yourself at the mercy of the whims, prejudices and perceived offenses of others. You can't know in advance which people you try to help are going to react without mercy. In spite of your good intent, you and your family can suffer devastating losses.
What Is Liability?
Liability means responsibility. When you have a church building, you are responsible for the safety of everyone who sets foot onto your property. If someone is injured, you are held liable. As clergy, you sometimes provide counsel to your church members or to others. You never know when a member or citizen will take offense to the counsel you provide. Someone may take offense to a comment you make from the corporate platform as well. If there is an offense, it can result in a lawsuit.
What Does a Policy Cover?
When you have professional liability insurance, your personal assets are protected in the event of a lawsuit. If you need legal representation due to a lawsuit, the insurance company pays for your representation. But if you have a previous lawsuit against you, it may difficult for you to get professional liability insurance, as (depending on the circumstances) insurance companies may view you as “high-risk.”
The amount of professional liability coverage a clergy worker needs varies between individuals. A clergy worker with 200 church members may not need as much coverage as someone who has a global platform. To determine how much insurance you need, consider how much you might be sued for. It's always a good idea to get more coverage than you think you need rather than to need it and not have enough. The more coverage you purchase, the higher your monthly premiums cost. Most indemnity insurance providers have a minimum insurance threshold of $1 million.
To get professional liability insurance, contact a liability insurance broker or agent. You'll need to give the agent your Social Security number or tax ID number to apply for coverage. Before choosing an insurance company, check company ratings through reporting agencies such as A.M. Best, Standard & Poor's, Fitch, Moody's and Wise. By doing so, you ensure that the company has the financial strength to cover you, should the need arise.