Liability Insurance for Lay Leaders & Volunteers

You may have a vestry members or other volunteer ask you if they are covered by your insurance. Or you may wonder what happens, for example, if someone who has access to money, steals it! Church Insurance has you covered.

The Directors & Officers Employment Practices policy is designed to protect Episcopal institutions, their employees, trustees, vestry members and volunteers against the following:

Wrongful Acts of individuals acting on behalf of the organization. It provides defense and pays covered awards up to a total of $1 million per participant.

Employment Practices Liability Covered are allegations of discrimination, harassment, wrongful termination, retaliation, misrepresentation to an applicant, libel, slander, defamation, failure to employ, deprived opportunity, wrongful evaluation or demotion, wrongful discipline, failure to enforce policy and violation of civil rights.

You can DOWNLOAD the Director & Officers Liability policy to share with others.

Check your policy to make sure you didn’t exclude this coverage — it is extremely important that every church and related entity carry this insurance. If you have a related entity — e.g., an organization that you control, even if it is a separate 501c3, make sure Church Insurance knows it belongs to you and specifically lists it on your policy. They will often include that entity at no extra charge. Schools and nursing homes are an exception and need their own policy.


Questions and Answers

Q: What are some typical claims common to a church?

A common Directors’ & Officers’ claim would be a suit against members of the vestry alleging financial mismanagement. In this case, the policy would provide both defense and indemnity coverage for the church and the individual vestry members. Claims can also arise during or after the calling of a new rector from one or several members of the congregation who are upset with the process or decision.

Q: Is there a deductible?

Yes, all policies contain a retention which is the dollar value of the loss you retain. In this way, it is just like a property deductible. Retentions range from $500 for small parishes up to $10,000 for large dioceses.

Q: Is there coverage for claims evolving from our operations in the past?

Yes, the Church Insurance Agency Corporation program does not have the prior acts exclusion found on most policies.

Q: Are volunteers included under the policy? 

Yes, any volunteer performing an authorized activity on the insured’s behalf is covered under the policy. The volunteer coverage definition in the policy is extremely broad.

Q: Who can participate in this program? 

The program is exclusively for Episcopal parishes, missions, dioceses and organizations.

Q: What can we do to help lessen the possibility of a claim? 

CIAC offers risk analysis and loss prevention tips designed specifically for Episcopal Entities. Employment Practices liability claims is one of the fastest growing liability areas. Over the past few years, the Episcopal Church has averaged more than 20 wrongful termination claims annually.

[NOTE: Call the diocese BEFORE you take any action to terminate an employee!]