In the past nine months, fires have destroyed dozens of churches. If you will truly have full protection from church insurance, then we recommend you look at certain clauses in your insurance policy. For example, the market value versus the replacement value should be looked at, and you need to understand the difference between replacement value and market value. Market value exists as what you could sell the church for on the open market today. Replacement value, on the other hand, evaluates how much it will cost to rebuild your church.
It is not uncommon for churches to have a market value of $650,000 but a replacement value of $1.5 million. How does this relate to your church insurance policy? If a total loss occurs, you want to ensure that the policy will insure the full replacement value over the market value. Nevertheless, you also want to make sure that you have adequate insurance. If you have under insured your property, that can have a significant impact on your church.
Let's say that you have damaged shingles because of hail, and you only insured it for 40 percent of the replacement value. Your claim will be less, and if the damage is significant enough, your ministry could have to pay for it. Provided you can afford it, experts always recommend insuring for the full replacement value.
Also, be careful of purchasing from a non-church carrier. While some of these companies will be great with car insurance, they will rarely give you the coverage or limit needed for helping your church in the event of a disaster. All insurance policies will seem like the same until you have to file a claim. During this time, you discover the good policies from the bad ones. Not all policies were created equal, and the market will vary based on the level and type of coverage chosen.
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