Understanding Church Property Insurance Coverage

At Beacon Insurance, our goal is to be your partner to minimize risks to your property, congregation, and leadership. That is why we aim to help clients understand their church property insurance. Church property insurance is complex, and the needs of all churches continue to change as they grow. Today, we will help to shed light on important factors you may want to explore in your property insurance.

What is the Difference Between Liability and Property Insurance?

Many people pose this question in regards to insuring church buildings and equipment. Liability insurance covers your church for liabilities for damage to others like falls, slips, damage to another person’s property, and even damage to another person’s reputation.

By contrast, church property insurance coverage protects those things owned by the church, such as buildings and other church property. Standard property insurance does not always cover all the damages incurred. We are happy to help you determine what, if any, additional church property insurance your church may need to reduce risks.

Coverage Categories

Standard church property insurance coverage falls into one of the three following categories depending upon the size and needs of a church.

Replacement Costs

Most churches should plan to secure a Replacement Costs policy at the minimum. This type of policy would provide the coverage needed to rebuild church facilities or replace church personal property with new items of similar value, such as church furniture.

Two areas we will cover with you to ensure adequate coverage for replacement costs are contract labor costs that would be needed to rebuild facilities as well as all items permanently attached to the church, such as a pew. The latter is an area that is often under calculated in value because these items are added over time. Some churches find it helpful to develop an inventory system, with supporting pictures or video, to document items to prove ownership while making a claim.

Actual Cash Value (ACV)

Churches that are in disrepair or, for whatever case, may not ever replace the damaged property, often choose an ACV policy. If your church needs an ACV policy, the value would be determined by the total of the church property minus its accumulated depreciation.


A coinsurance policy is a specific percentage of insurance to the value insured. With coinsurance coverage, most companies require that 80-90% of the property value in coverage limits be in place at the time of a loss to not incur a penalty.

Common Areas of Coverage Risk


Church fires are steadily on the rise. According to GuideOne, arson is the number one fire threat to churches. Arson causes almost 1 billion dollars in damage to churches each year. In addition to arson, other overlooked fire threats include electrical hazards and kitchen fires.


On the Gulf Coast, lightning damage claims are common. A lightning strike during a storm typically causes significant damage to the electrical, soundboards, and fire alarms of church buildings.

Remember, standard property insurance does not always cover all damages incurred. Two areas of additional coverage your church may want to consider are Flood and Business Income.

Flood Coverage

As residents of the Florida Panhandle, we know too well the devastation a flood can cause to a church and its congregation. Recent natural disasters have brought flood church coverage to the immediate attention of church leaders in our area. We are happy to help you ensure that you have adequate coverage for your church size and needs.

Business Income

Business Income coverage provides the replacement of lost or reduced income to a church due to damage of a covered event. Because the church is a unique type of institution, many churches believe income would not be affected in time of loss because services and operations can take place elsewhere.

However, it is always a valuable idea to assess this risk to ensure that you have all areas of concern covered and do not incur any additional expenses trying to cover lost income should you suffer damage.

At Beacon Insurance, our goal is to help minimize your risk with adequate coverage specific to your church needs. Our personal service and expertise are the difference.

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