High Inflation Hits Churches and Church Insurance Providers: Building Replacement Cost Limit Sores

Churches and religious organizations feel the pinch of high inflation rates as their building replacement cost limits increase. Church insurance providers also see an impact as the cost of insuring these buildings increases.


Inflation has been rising recently and is starting to hit churches and other religious organizations hard. Building replacement costs have soared, and church insurance providers have to make the difficult decision to increase building coverage for churches by over 25 percent.


Churches and religious organizations need to be prepared for the worst and ensure that their buildings are insured for the right amount. Otherwise, they could be left with a huge financial burden if something happens to their property.

Churches and Church Insurance Providers are Feeling the Pinch of High Inflation Rates

Churches are not immune to inflation affecting many aspects of daily life. As building costs have risen recently, church insurance providers have struggled to maintain the proper building limits, even with an inflation guard attached to the policy.


Since church buildings have substantial replacement cost limits that can soar in times of high inflation, church insurance agencies are looking for new strategies to assist churches in managing their costs. It falls upon church insurance agents to find solutions that guarantee church property insurance does not become unaffordable during periods of financial stress.


Rising building insurance values also impact the church insurance companies as they must now provide higher building limits which require obtaining additional insurance capacities knowns as re-insurance. Suppose the insurance company currently insures 35 billion in property exposure, and this property exposure increases by 38% overall. In that case, they now need an additional 13.3 billion dollars in new insurance capacities from additional re-insurance markets.


At a time when church resources are already stretched thin, those in charge of their church building insurance must creatively broker solutions that will benefit churchgoers and protect the investment placed in each church building.

Building Replacement Cost Limit Sores

Building Replacement Cost Limit Sores are Becoming a Problem

The rapid inflation rise has hit churches and church insurance providers particularly hard, causing church building replacement cost limits to soar. Church boards must review their property policies to ensure they are insured correctly.


Built into all policies is a coinsurance clause that requires churches to maintain adequate property coverage or face hefty penalties. These penalties equal a reduction in property coverage in the event of a loss equal to the underinsured percentage.


This can equate to hundreds of thousands of dollars, if not millions of dollars, in penalties. A church that should be insured for $10,000,000 but only pays for $5,000,000 in church building insurance is underinsured by 50% and would only receive $2,500,000 from the insurance company to rebuild its church.


No church should ever have to worry about the skyrocketing costs associated with building repairs, replacements, and upgrades; that’s why church insurance brokers play such an essential role for church communities.


It is the church insurance broker’s job to ensure that your church or congregation receives the coverage necessary to meet the underwriting guidelines of a church’s insurance policy. With knowledgeable, experienced church insurance agents acting as advisors on matters of risk and protection, religious leaders can rest assured that their churches will be financially protected.

Many Churches are Struggling to Keep Up with the Rising Costs

As small churches across America struggle to keep up with increasing costs, one of the significant expenses has been in the area of small church insurance programs. High inflation rates have caused building replacement costs to soar, stretching small church budgets too thin; leaving church leaders scrambling for solutions.


To combat these rising costs and help small churches protect their buildings and budgets, small church insurance providers have developed highly competitive small church insurance plans to help bridge the gap while allowing churches more freedom to continue their mission.


Integrity Now Insurance Brokers has helped many churches, big and small, obtain affordable church insurance coverage. Give us a call, and we will review the church insurance policy.

Some Church Insurers are Starting to Cancel Coverage for Churches

Churches located in high-risk areas such as the coast or mountains are faced with being dropped by their insurance company altogether. This forces religious organizations to seek help from last-resort companies, which can charge much higher insurance premiums.


Not only are churches being told they must increase their building limits, but they are also facing a 200 percent or more increase in premiums due to preferred insurance companies not being willing to cover their church any longer.


Even with the help of an insurance agency specializing in church insurance, these churches face a record number of price hikes to protect their nonprofit organizations.

Churches Need to be Prepared for Increased Church Insurance Costs

These rising costs are putting substantial pressure on church budgets. Not only are church services seeing lower attendance, but church groups are also experiencing lower offerings and being expected to pay more to keep their doors open.


Churches must consider the increased cost of adequate protection and plan financially as premiums continue to rise.


As your church insurance agent, we are here to help churches make wise decisions on how to insure their buildings and congregation by providing resources and guidance about how best to protect themselves against these growing expenses.

Frequent asked questions faq

How to Calculate Replacement Cost Insurance for Church Buildings

Calculating replacement cost insurance for church buildings can be daunting without a church insurance expert. We utilize specialized software to look at the following information:

  1. The age of the church building
  2. Construction type
  3. Unique features that might affect its value, such as a bell tower
  4. Style of the church building (Traditional, Auditorium, Contemporary)
  5. Local costs for labor and materials when estimating replacement costs.


What is a church insurance package policy?

A church insurance package policy is a comprehensive policy that typically includes property, liability, business auto insurance, and worker’s compensation coverage. These package policies help to reduce the overall costs by grouping coverage with a single insurance company.


How to obtain an old church insurance policy?

If your church buildings are older, insurance companies specializing in churches will want to know all required building updates have been completed. This includes a new roof, updated plumbing, electrical, and HVAC systems.


What is inflation guard insurance?

Inflation guard insurance is an essential type of insurance that helps protect against inflation’s effects. The inflation guard will adjust the amount of property coverage to accommodate price increases due to inflation.


How to obtain affordable insurance for small churches?

Contact an insurance agency specializing in church insurance. Our agency works with many small churches to help obtain affordable church liability insurance coverage.

Church Insurance Solutions For Struggle Christian Churches

Integrity Now Insurance Brokers provides church insurance solutions for struggling Christian Churches. Our team of experienced insurance agents takes the time to understand the unique risks and exposures facing churches and religious organizations.


Integrity Now offers a range of tailored insurance policies, such as property, liability insurance for churches, directors & officers, cyber, crime, and workers’ compensation coverage for churches.


With Integrity Now Insurance Brokers on your side, you can rest assured that your church or other religious organization is adequately protected with the right coverage at the most competitive rates.


Call us to request a church insurance quote and start saving money in the new year.

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