Key Insurance Traps Church Leaders Must Avoid in 2026
- Poole & Jackson Insurance Agency
- Jan 6
- 4 min read
Church leaders face unique challenges when it comes to managing insurance. As 2026 approaches, new risks and regulations are reshaping the insurance landscape. Avoiding common pitfalls can protect your congregation, property, and ministry from costly surprises. This post highlights key insurance traps church leaders must watch for and offers practical advice to navigate them confidently.
Overlooking Liability Coverage Changes
Liability insurance protects churches from claims related to injury or property damage on their premises. In 2026, many insurers are tightening liability coverage due to rising claims in areas like sexual misconduct, abuse, and accidents during church events.
What to watch for:
Narrowed coverage for abuse claims: Some policies now exclude or limit coverage for abuse allegations. Churches must verify if their policy includes this protection or if separate coverage is needed.
Event-specific liability: Activities such as youth camps, sports leagues, or community outreach may require additional endorsements or separate policies.
Volunteer protection gaps: Volunteers often face risks, but not all policies cover them fully. Confirm that volunteer-related incidents are included.
Example: A church hosting a summer camp found its liability policy excluded coverage for injuries during off-site activities. This gap led to significant out-of-pocket expenses after an accident. Checking policy details beforehand could have prevented this.
Ignoring Property Insurance Updates
Church properties often include sanctuaries, offices, fellowship halls, and sometimes schools or daycare centers. Property insurance must reflect the full scope of these assets and their uses.
Common traps include:
Underinsuring buildings and contents: Inflation and rising construction costs mean replacement values increase yearly. Using outdated valuations can leave churches underinsured.
Excluding certain property types: Some policies exclude coverage for items like musical instruments, artwork, or specialized equipment unless specifically added.
Not covering natural disasters: Depending on location, flood, earthquake, or windstorm coverage may require separate policies or endorsements.
Tip: Conduct an annual property inventory and valuation review with your insurer to ensure coverage matches current needs.
Failing to Address Cybersecurity Risks
Churches increasingly rely on digital tools for donations, communications, and record-keeping. Cyberattacks and data breaches are growing threats that many traditional insurance policies do not cover.
Key points:
Cyber liability insurance: This coverage protects against data breaches, ransomware attacks, and other cyber incidents.
Data protection: Policies may cover costs related to notification, credit monitoring for affected individuals, and legal fees.
Employee training: Insurers often require evidence of cybersecurity training and protocols to qualify for coverage.
Example: A church’s donor database was hacked, exposing personal information. Without cyber insurance, the church faced costly legal and recovery expenses.
Overlooking Employment Practices Liability
Churches employ staff and manage volunteers, which creates risks related to employment practices. Claims of discrimination, wrongful termination, or harassment can arise even in faith-based organizations.
What to consider:
Employment Practices Liability Insurance (EPLI): This protects against claims related to workplace issues.
Policy exclusions: Some insurers exclude coverage for religious discrimination claims or require specific endorsements.
Clear policies and training: Having documented employment policies and regular training reduces risk and supports insurance claims.
Tip: Review your EPLI policy carefully and consult legal counsel to ensure it fits your church’s employment structure.
Not Reviewing Insurance Contracts Annually
Insurance needs evolve as churches grow, change programs, or acquire new assets. Failing to review contracts yearly can leave gaps or unnecessary coverage.
Steps to take:
Schedule an annual insurance review meeting with your broker or agent.
Update your insurer on new programs, property purchases, or changes in volunteer activities.
Compare quotes from multiple providers to ensure competitive pricing and coverage.
Example: A church expanded its community outreach but did not inform its insurer. When a claim arose related to the new program, coverage was denied due to lack of notification.
Overpaying for Unnecessary Coverage
While protecting your church is vital, paying for coverage you don’t need wastes resources. Some policies bundle coverages that may not apply to your church’s size or activities.
How to avoid this:
Assess your church’s specific risks and needs.
Decline optional coverages that do not fit your situation.
Ask your agent to explain each coverage’s purpose and cost.
Example: A small rural church paid for commercial auto insurance on vehicles rarely used for ministry. Adjusting coverage saved hundreds annually.
Missing Out on Discounts and Group Plans
Many churches qualify for discounts or group insurance plans through denominational affiliations or church networks. Missing these options means paying more than necessary.
Look into:
Denominational insurance programs offering tailored coverage.
Group purchasing arrangements that lower premiums.
Bundling property, liability, and other policies with one insurer for discounts.
Conclusion & CTA:
Your church is more than a building — it’s a place of worship, community, and ministry. Protecting it means more than having insurance; it means being proactive, staying informed, and avoiding costly gaps. As 2026 brings new risks and regulations, now is the time to ensure your congregation, volunteers, and assets are fully safeguarded.
Don’t wait until it’s too late. Schedule a comprehensive church insurance review today with Poole & Jackson Insurance Agency and secure the protection your ministry deserves.
Comments