Church Property Insurance Expert!

EMPLOYMENT PRACTICE LIABILITY INSURANCE FOR CHURCHES

Churches and nonprofit organizations can be a great place to work for many people, but they can also hierarchical structure issues that can conflict with a typical business environment.

Because of this, churches face an increasing likelihood of an employee seeking a lawsuit alleging discrimination, sexual harassment, retaliation, and other claims.

It can be difficult for churches to separate church culture from their business liabilities and responsibilities as an employer. 

To help you protect against this liability from an insurance point of view, church insurance companies offer Employment Practices Liability Insurance (“EPLI”) coverage. 

This insurance helps provides the needed coverage related to wrongful employment act claims, against your church organization.  A typical employee or applicant can make the accusation that you as their violated their legal rights.

This includes employment-related claims made through the Equal Employment Opportunity Commission (EEOC) or the equivalent state administrative agency.

As church insurance experts, we have heard from countless churches, that their employees would never pursue legal action. Unfortunately, I wish this was true, but we have seen time and time again churches face legal challenges even from their most trusted church members. 

EMPLOYMENT PRACTICE LIABILITY INSURANCE for churches

What Employment Practice Liability Insurance Covers For Churches

Unlike a workers’ compensation insurance policy that protects your employees if they become injured on the job. An Employment Practice Liability Insurance policy provides coverage for both the employer and the employee for reimbursement for settlements, judgments, and the expense of defending yourself when you are accused of:

  • Failure to hire or promote within
  • Discrimination against employees or prospective employees
  • Sexual or other harassment or coercion
  • Wrongful termination, dismissal, or discharge
  • Employer retaliation
  • Employment-related libel, slander, humiliation, mental anguish infliction of emotional distress, defamation, or invasion of privacy.
  • Employment-related misrepresentations to employee or applicant
  • Other wrongful employment acts

How Much Employment Practice Liability Insurance Coverage Should Our Church Carry

The average Employment Practice Liability Insurance claim costs an organization between $27,000 and $50,000. We have seen very few claims fall below the $27,000 mark but we have seen many claims exceed $150,000. 

The cost difference between $100,000 in Employment Practice Liability Insurance coverage and $250,000 is a couple hundred dollars a year.  Your church does have the option of obtaining up to $1,000,000 in Employment Practice Liability Insurance coverage which cost around $1,000 or less for most churches. 

Following are a few claims that illustrate how a claim can happen, — and their possible costs:

  • A small nonprofit organization board members disagree with how the Director was managing the nonprofit. They get into an argument which then leads to their termination.  The employee feels like the board members had wrongfully terminated the Employee.  The claimant provided several emails and was able to get a fellow employee who attested to the claimed adverse treatment by the nonprofit. Settlement: $170,000
  • The church office manager felt excluded from staff meetings as a woman. The weekly church staff meetings only included male staff.  When she was invited to a meeting, there was usually a separate staff meeting that took place after she was excused.  Employee felt discriminated against because she was a woman and filed a lawsuit after she had told church leadership of her concerns with no change in behavior. Settlement: $85,000

 

If your church faced a $500,000 Employment Practice Liability Insurance claim, would your church organization be able to survive?  We understand that most churches are barely able to afford the bills they are faced with each month.  Have a well balanced church insurance program is vital to your churches overall success.  

Ways For Churches to Reduce Their Risks

Churches face huge challenges as they attempt to function as a church ministry, but they cannot forget they are also considered an employer and face employment liability risk.  Unfortunately, churches are also a business and need to have the protective safeguards in place to protect the organization and the employees’ rights. 

Churches who are too small to afford a Human Resource professional, has no documented best practices to follow, and potentially high employee turnover rates due to low pay, are all contributing factors your churches can’t afford not to have an Employment Practice Liability Insurance policy in place. 

When your church seeks to help prevent wrongful employment act claims, you may want to consider the following:

  • Stay up to date on current employment laws
  • Keep your church insurance agent updated on changes to your church staff.
  • Obtain and update your hire processes.
  • Have a detailed employee handbook updated annually to stay in compliance with your state laws.
  • Make it clear that you have a zero-tolerance policy on sexual and other types of harassment.
  • Review your church organization for possible discrimination exposures.
  • Request anonymous reviews from all staff members of all ages, race, and genders if they feel change needs to happen related to discrimination.
  • Conduct background and reference checks prior to employment.
  • Conduct annual documented reviews of your staff.

We Can Help You Buy an Employment Practice Liability Insurance Policy for Your Church

Our church insurance agent’s are ready and waiting, to help your church obtain an employment practice liability insurance policy your church.  We strive to make the insurance process as quick and smooth as possible. 

In order to save your church money on their insurance our church insurance providers include EPLI coverage as part of a commercial package policy.  This includes coverage for your general liability insurance, directors and officers insurance, abuse and molestation insurance, church property insurance, and more.  We will also help your church secure a workers’ compensation insurance policy and a church business auto insurance policy.  

To get started, feel free to give one of our church insurance brokers a call and/or fill out the contact form with any questions or queries you might have. Our church insurance experts will assist you throughout the entire process, providing unique insurance and risk management solutions for your Church. 

Don’t wait any longer; take the first step toward having adequate church property insurance protection today at an affordable price! We’re just a phone call away. So feel free to reach out to us at any time for any queries or questions regarding our services.