Church Employee Insurance Coverage: Employee Benefits For Clergy, Pastors, and Church Staff
Churches have an obligation to take care of their employees by providing their pastors and church staff with health coverage offed by houses of worship. Religious organizations can provide their staff with a traditional group health plan, and dental, and vision insurance benefits.
Large church insurance programs can offer employees more comprehensive plans, including retirement benefits and additional coverage enhancements for group benefits.
Working with an experienced church insurance agent with access to special religious insurance programs unavailable to traditional health insurance agents is vital.
Types Of Employee Benefits Insurance Coverage For Churches
1. Health insurance for churches
Several types of health insurance plans are available for church employees, including:
- HMO Plans
- PPO Plans
- High-deductible plans.
HMOs typically offer lower out-of-pocket costs and require members to choose a primary care physician, while PPOs offer more flexibility in choosing doctors and hospitals but may have higher costs to both the church organization and its employees.
High-deductible plans have lower monthly premiums but require members to pay more out-of-pocket before insurance coverage kicks in. Benefits and coverage options vary depending on the plan but may include preventive care, hospitalization, prescription drug coverage, and mental health services.
Health insurance plans must provide at least the minimum essential health benefits as part of each plan. As your employees reach 65 years old, they should move off of the employers’ insurance and onto a Medicare plan.
2. Dental and Vision Insurance
Dental and vision insurance are essential health benefits to church employees to help them maintain good oral and eye health. When offering group dental and vision plans, the standard waiting periods for major services do not apply as they often do on individual dental and vision plans.
3. Group Life insurance
Integrity Now Insurance Brokers offers group life insurance for all church organizations, including Episcopal institutions’ employees. Group life insurance includes coverage limits up to the carrier’s caps with no medical underwriting.
If an employee wishes to purchase higher life insurance limits, we will help them find the most suitable life insurance plan. This is typically obtained through individual coverage vs. the group life insurance policy.
The premium paid for Group Life is generally a business deduction and is usually less expensive. Eligibility requirements may vary depending on the group size and state your church resides in.
4. Workers’ Compensation Insurance
Workers’ compensation insurance is a type of insurance that provides benefits to employees who are injured on the job. Workers’ compensation insurance protects employers from lawsuits and provides employees with medical care, lost wages, and rehabilitation services.
Church employees may be entitled to benefits such as:
- Medical expenses
- Lost wages
- Disability benefits if they are injured while working on behalf of the religious institution
5. Short-Term Disability insurance
Short-term disability insurance is designed to provide income replacement to employees who suffer a temporary disability. It replaces a portion of the wages lost due to the disability, typically up to a certain percentage of the employee’s salary.
6. Long-Term Disability Insurance
Long-Term Disability (LTD) Insurance provides financial assistance to employees who cannot work due to an extended illness or injury. This protection is essential for church employees and the church organization as it helps them cover their expenses when their regular income is interrupted.
LTD insurance offers flexible plan design options and benefits alternatives that can be customized to meet specific needs. This valuable protection is available at low-cost, tax-deductible premiums, making it an affordable option for church employees.
7. Employer-Sponsored Retirement Plan
Churches offer various benefits for their church staff depending on the financial resources of the religious groups. In California, churches can now register with CalSaver, allowing employees to start saving for retirement needs.
Quickbooks online for churches offer an affordable 401K option allowing employees to contribute to either a Roth or traditional 401K. Quickbooks and the plan sponsor (Guideline) are fully integrated with your church payroll, making the process seamless.
8. Unemployment Insurance
Unemployment insurance is a government program that provides temporary financial assistance to individuals who have lost their jobs due. Employers fund this program through a tax on their payroll.
Church employees are eligible for unemployment insurance coverage, but it varies depending on the state in which they work. In some states, churches are exempt from paying unemployment insurance taxes, so their employees may not be covered.
However, some states allow churches to opt into the program and provide employee coverage voluntarily. Church employees must verify if their church employer pays unemployment insurance before accepting a position.
9. Cancer Insurance Policy
A cancer insurance policy is a type of insurance that provides financial support to employees who are diagnosed with cancer. Combined with a health insurance plan offered by churches, it can cover the gaps in coverage for cancer treatment, such as co-pays, deductibles, and out-of-pocket expenses.
This policy can help ease the financial burden of cancer treatment and allow employees to focus on their recovery. For example, a church employee diagnosed with cancer can use the policy to cover the costs of chemotherapy, radiation, and surgery.
10. Accident Insurance Policy
Churches can provide their employees with accident insurance policies that typically include coverage for medical expenses, disability benefits, and accidental death and dismemberment benefits. Church employees who work in physically demanding roles or frequently travel for work may particularly benefit from this type of insurance policy.
In the event of an accident, this policy can help cover expenses while their regular income is interrupted for an extended period and provide financial support to their family in the case of accidental death or dismemberment. An accident insurance policy can help fill in the gap of a church’s short-term policy that typically pays 66 percent of the employee’s salary.
What Are The Benefits Of Having A Church Employee Health Insurance Program?
Offering an employee benefits insurance package is crucial for a church’s and its ministry’s success. A quality benefits package incentivizes employees, demonstrates the organization’s commitment to its people, and can minimize costly turnover while attracting new employees.
Benefits may include the following benefits:
- Paid time off (PTO)
- Health insurance (medical, dental, and vision)
- Retirement plans
- Life and disability insurance
- Wellness programs (Gym membership and Yoga classes).
Integrity Now Insurance Brokers are known for providing the most comprehensive employee benefits package through our network of church insurance providers. Providing generous benefits for church employees is part of a strategy that attracts and retains key employees.
How To Find The Best Church Employee Insurance Coverage For Religious Organization?
As a religious organization, your employees are critical to your success and ministry. Providing them with a comprehensive employee benefits insurance package is a great way to recognize their value, strengthen their loyalty, and enhance their performance.
Follow these steps to find the best insurance coverage for your church employees:
- Assess Your Needs: Before looking for church insurance brokers to assist in finding health plans, take the time to assess your organization’s needs. Determine what individual and family coverage you need, such as health, dental, or life insurance. Consider the size of your organization and the number of employees you have.
- Research Providers: Once you know what types of coverage you need, research different insurance providers. Look for providers specializing in church insurance and have experience working with religious organizations. Consider factors such as cost, coverage, and customer service.
- Compare Plans: Once you’ve narrowed your list of potential providers, compare their plans. Look at the benefits offered, deductibles, and premiums. Consider the cost versus the value of each plan.
- Consider Group Plans: Group plans are always less expensive than individual plans. Consider offering a standard plan for all employees or offering each employee the same dollar benefits and permitting the employee to select desired benefits from a “menu” of options provided by the insuring company.
- Offer Health Insurance: Health insurance benefits can help care for your employees’ health needs. Find affordable ways to provide health insurance to your church staff, such as health reimbursement arrangements (HRAs) or taxable stipends.
- Consider Other Benefits: Besides health insurance, consider offering other benefits such as dental, vision, life insurance, and retirement plans. These benefits can help attract and retain employees.
- Consult with our Church Insurance Agents: If you’re unsure which insurance provider or plan to choose, consider consulting with a health insurance consultant. They can help you navigate the complex insurance world and find your organization’s best church insurance coverage.
Should Religious Groups Consider Health Reimbursement Arrangements (HRA) Health Plans?
Religious groups may want to consider health reimbursement arrangements (HRAs) to provide healthcare benefits to their members. HRAs are medical reimbursement plans in which employers allocate a certain amount of money to employees for medical expenses.
This approach gives religious groups more control over how their funds are used and helps them avoid having to provide health insurance directly. HRAs can be set up to cover expenses such as medical and dental costs, including prescription drugs. They can be used to pay for services provided by healthcare providers such as doctors, hospitals, and clinics.
Religious organizations can use HRAs to help their members access medical care and prescriptions while adhering to their religious beliefs. However, religious groups should consider the potential tax implications of using HRAs and seek professional advice before implementing them.
An HRA plan allows churches to enroll in more affordable health insurance plans and allow their employees to afford medical costs better than they may face. If your full-time salaried employees are younger, this type of plan structure can be beneficial for all.
How does the church decide on the amount of total compensation to provide for its employees?
As a whole, churches typically pay a lower cost towards employee salaries and benefits as their funding is primarily driven by offerings received from their members. The church determines the salary based on its budget, with larger budgets allowing for higher wages.
However, benefits follow different rules and are priced differently than wages and salaries.
Many churches spend an average:
|Health Insurance||Retirement Plans||Disability Insurance|
The cost of health insurance does not vary based on the overall age of the group. Older church staff can increase the overall insurance premium significantly compared to a younger one.
What are the requirements for an employee to be eligible for church insurance coverage?
Eligibility for insurance benefits typically depends on an employee’s status as a full-time or part-time worker, with full-time employees generally being eligible for more comprehensive benefits. Additionally, churches may offer benefits such as sick leave, paid vacation, retirement plans, life and disability insurance, and wellness programs.
Does the church provide any additional benefits to employees besides health insurance coverage?
Yes, these benefits may include paid leave time, retirement plans, life and disability insurance, and wellness programs. Many churches offer spiritual development trips to their leaders and staff.
What are the requirements for a church employee to receive reimbursement for their medical expenses?
The requirements for church employees to receive reimbursement for their medical expenses vary based on the specific church’s policies and the state they reside in. Generally, an employee may need to submit a request along with medical expense documentation and proof of payment.
The church may also require the employee to be enrolled in the church’s healthcare plan to be eligible for reimbursement. The church may also limit how much money can be reimbursed to employees annually.
Churches must establish guidelines and seek legal advice from an attorney before reimbursing medical expenses to ensure they are legally allowed to in your state.
Can Churches Reimburse Individual Health Insurance Plans?
The short answer is yes. Churches can reimburse individual health insurance plans. However, there are specific guidelines that must be followed to do so.
The Internal Revenue Service (IRS) has established rules under the Affordable Care Act (ACA) that dictate how employers, including churches, can reimburse employees for their health insurance premiums. Churches can use a Health Reimbursement Arrangement (HRA) to reimburse employees for individual health insurance plans.
Hire A Church Insurance Consultant
Hiring a church insurance consultant like Integrity Now Insurance Brokers can provide several benefits to your organization. With our expertise in navigating complex health insurance policies, we can help you customize coverage to fit the specific needs of your church.
Finding a consultant with experience working with insurance for churches and their unique insurance needs is vital. By working with a knowledgeable church insurance consultant, your house of worship can ensure that it is adequately protected and prepared for potential risks.
Integrity Now Insurance Brokers helps churches throughout the US with their church property insurance, liability insurance, directors and officers insurance, business auto insurance, workers’ comp insurance, abuse and molestation insurance, religious belief coverage, Employment practice liability insurance, pastoral counseling insurance, flood insurance, earthquake insurance and more.
As a full-service church insurance agency, we are here to help with all your church insurance needs. Contact us today for a free church insurance quote.