Skip to content
English
Contact us
  • There are no suggestions because the search field is empty.

What Should You Know About Workers' Compensation for Texas Churches?

Workers' compensation is a specialized insurance policy that provides medical benefits and wage replacement to employees injured on the job.

Unlike almost every other state, Texas does not require private employers, including churches, to carry this coverage. However, choosing to opt-out isn't a good idea. It actually opens the church up to significant legal risks that most ministry budgets aren't prepared to handle.

The Janitor’s Fall in Jacksonville

A small church in Jacksonville, Texas, decided to save a few thousand dollars a year by not carrying workers' comp. They figured their general liability policy was enough. When their part-time custodian fell off a ladder while changing lights in the sanctuary, he shattered his hip and required multiple surgeries.

Because the church didn't have workers' compensation insurance, the custodian's only path to getting his medical bills paid was to sue the church for negligence. Under Texas law, non-subscribers lose their legal defense protections. The church couldn't argue that the custodian was clumsy or should have known better. They were hit with a $150,000 judgment for medical bills, lost wages, and pain and suffering. None of it was covered by their general liability policy.

Subscriber vs. Non-Subscriber: The Great Trade-Off

When a Texas church decides whether to buy workers' comp, they are choosing between two very different legal worlds:

  • The Subscriber (With Coverage): The church pays a premium for a state-regulated policy. In exchange, they receive exclusive remedy protection. This means that in nearly every case, an injured employee cannot sue the church. They get their medical bills and lost wages paid, and the church gets immunity from lawsuits.
  • The Non-Subscriber (No Coverage): The church saves on premiums but remains fully liable for any workplace injury. If an employee is hurt, they can sue the church in civil court. Most importantly, Texas law strips non-subscribers of the contributory negligence defense, making it much easier for a jury to find the church at fault.

Church Workers' Compensation

Common Misconceptions For Texas Churches

  1. Our general liability covers injuries. – False. Standard general liability policies almost always exclude injuries to your own employees. A GL policy is meant to protect the church from the liability associated with injuries to guests and visitors, not the paid employees.
  2. Pastors aren't employees. – False. While the IRS might treat clergy as self-employed for tax purposes, the Texas Department of Insurance (TDI) generally views them as employees for workers' comp purposes if the church controls their work. You need an agent who knows how to correctly classify the pastor for your workers’ compensation policy.
  3. We have an accident policy for staff. – Risky. A small accident policy might pay $5,000 for a broken arm, but it won't protect the church from a $500,000 lawsuit if that arm requires three surgeries and prevents the employee from working for a year.

Is Your Ministry Mission at Risk?

One serious workplace injury can bankrupt a small-to-mid-sized church very quickly.

Are you gambling with your church’s budget? Choosing to skip workers' compensation insurance is a high-stakes bet that no one will ever get hurt on your watch. Our personalized risk assessment looks at your staff size and daily activities and recommends coverage based on your church’s unique needs.