Over the last year, some New Mexico churches have found themselves without insurance. After a large claim or if a church’s location is thought too risky, insurance companies have been canceling or raising the deductible or premium so high that the church can no longer afford it. In response, churches have had to look elsewhere for insurance.
Gerald Farley said these issues are happening all over New Mexico. Over the past year, he said, around 25 to 30 churches have called him about losing their insurance. Farley serves as the Baptist Convention of New Mexico’s business administrator, who helps churches navigate financial, tax, legal, personnel, insurance and property issues.
Many churches in New Mexico are located in areas that insurance companies consider risky or where they receive hail and wind damage. Churches on the state’s eastern side often face damaging hail and wind. One church, Farley said, lost its entire roof.
Mountain problems
The other issue, Farley said, is that we are a mountainous state.
“We think of us as being desert, and we are high desert, but we’re mountainous, and there are a lot of churches in the mountains. For me, I’m hard-pressed to say that’s a mountain church, but that’s how the insurance companies look at it,” he said. The issue is that mountain churches are often surrounded by forests and present a wildfire risk. In one community in New Mexico, Farley said, an insurance company canceled four churches.
Farley clarified that the local agents are not causing the issue. He said, “Our local agents are phenomenal. The problem is, it’s the underwriting department in these insurance companies that are saying, we’re not going to cover it.”
Hope amid sky-high deductibles
The other two problems are that rather than canceling the insurance, the insurance companies raise the deductible or the premium so high that the churches do not have enough money to pay it. Farley said an insurance company raised the deductible to $25,000 for one church. Another had its deductible raised to $40,000 for hail or roof damage.
The churches left without insurance have had to seek other insurance companies. “So far,” Farley said, “I’ve been able to get them insured with someone else.”
Farley said that some churches have had to go to insurance companies that do not usually write for churches to cover their buildings, liability, and vehicles. These companies, however, do not cover all of the insurance needs of churches, such as counseling and nurseries.
EDITOR’S NOTE — This story was written by Johanna Nelson and originally published by the Baptist New Mexican.
