Last spring, a church in Amarillo found out the hard way that their property insurance was not as strong as they thought. After a violent hailstorm rolled across the High Plains and ripped through their neighborhood, the church roof took a beating and the old pipe organ suffered water damage when the rain poured through holes in the sanctuary ceiling.
Pastor Mark and the board thought filing a claim with the insurance company would take care of it all. They assumed insurance would pay to fix the roof and cover the wind and hail damage that made its way inside. But when the adjuster called back to discuss their insurance claim, they were shocked.
The adjuster began to explain that parts of their building were undervalued. The roof claim would pay out less because of a limitation called actual cash value. And the deductible was big enough to drain half their emergency fund.
This unexpected hit to their budget forced the church to pause their building improvements and hold extra fundraisers. It was a hard lesson in how church property insurance works. And what every other Texas church needs to understand before the next storm rolls through.
No matter where your church is located across Texas, it will face strong winds, hail, heavy rain, and sometimes tornados. Church Insurance is meant to protect your mission and keep the doors open even when those storms roll in. But too many churches learn too late that they did not have the right property coverage.
The good news is that you can do better than guessing. Knowing a few key facts helps you ask smart questions and make wise decisions when you sit down with your agent.
Pastor Mark's Church in Amarillo assumed every structure on their property was automatically included on the policy they bought online. But after the insurance claim was filed, they discovered their garage and youth portable building were never added to the policy. That meant the roof damage on those buildings would not be paid for at all.
A church insurance policy covers what is listed and valued properly. The main sanctuary and fellowship hall are obvious, but what about detached classrooms, garages, storage sheds, or new additions? Each building should appear by name and amount on the insurance policy paperwork.
It is easy for churches to build a new outbuilding or renovate the old kitchen without remembering to update their policy. If your church has built something new in the last year, check that it is on the books.
When water poured through the broken roof after the storm in Amarillo, it ruined the sound equipment, a few computers in the office, and damaged the old hymnals that were stored on high shelves. They found out too late that their limit for church personal property was too low to cover everything.
Church personal property means the stuff inside the buildings. Pews, chairs, musical instruments, kitchen appliances, computers, audio and video equipment, classroom supplies, and decorations are all considered personal property.
Many churches underestimate how much all that adds up to. The cost to replace sound boards, pipe organs, projectors, and office tech can shock you. Make a list of what your place of worship owns and the value to replace it. Then compare that to the limit on your current church insurance coverage. If you cannot replace your things for that amount, it is time to increase it.
The roof at Pastor Mark's church was over 10 years old when the storm hit. The church property insurance company used Actual Cash Value for the payout instead of Replacement Cost as a result of that age. That meant the church only received money for what the old roof was worth, not what a brand new roof would cost even though the property damage done by the hail storm made it a total loss. It left a huge gap they had to fill with donations and emergency funds.
Replacement Cost means the insurance will pay for a new item of like kind and quality, without subtracting for age or wear. Actual Cash Value means the payout will be lower because it accounts for how old the item was at the time of the loss.
Many church policies use Replacement Cost for some things and Actual Cash Value for others. Roofs older than ten years often get switched to Actual Cash Value without you noticing. Ask your agent which parts of your buildings and contents are covered one way or the other in case of an insurance claim. You might need to plan for upgrades or set aside extra savings if you have older roofs or aging equipment.
The biggest shock for most Texas churches today is the size of their wind and hail deductible. The church leaders in Amarillo assumed it was still the same value from five years ago when the church insurance coverage was put in place.
With finance committees in churches changing each year, it is easy to miss a change to church insurance packages. But as church insurance providers have attempted to reduce their risk in the hail insurance claims, they have raised those minimum wind and hail deductibles. And that is exactly what happened in Amarillo.
Look at your policy and find the wind and hail deductible. When you do the math on the percentage, it might surprise you how big your cost will be for a church property claim. Some churches choose to buy a separate policy called a deductible buy down to lower the out-of-pocket portion for a storm claim.
Many churches have beautiful stained glass windows that may survive hail, but may not next time. Some unique items like stained glass, historic pipe organs, or big steeples may have specific sub-limits from the church insurance carrier. These special items often need extra coverage or an endorsement to be fully protected.
The same goes for expensive audio visual systems, fine art, or valuable collections that your church displays. If your church has anything rare, historic, or high in value, ask your church insurance specialist if there is enough coverage to repair or replace it.
Pastor Mark and his board wishes they had reviewed these details before the insurance claim from their big storm. They learned that what they did not know cost them extra money, stress, and time away from ministry work.
A Texas church should never guess about property insurance. Our weather demands that you know exactly what you own, how it is covered, and what you will pay when something bad happens.
The good news is you do not have to figure this out alone. Working with a Texas-based independent church insurance specialist helps you find hidden coverage gaps, set proper limits for property damage, and build a risk plan that fits your House of Worship, your budget, and your mission. And that is exactly what True Texas Church Insurance does all across this state.
Pastor Mark is now working with Insurance For Texans to make sure their church buildings, contents, and unique features have the right coverage for the next storm season. They sleep better knowing they have True Texas Church Insurance is built for churches just like theirs. That is the promise of certainty.
Click the button below to talk with an agent who knows Texas churches and our Texas weather. Get peace of mind before the next storm cloud rolls in.