January 24, 2023
Written by Dustin Strande, Regional Director of the Dakotas
This innovative product has been around for a while but is becoming more relevant in this hardening market due to large wind and hail losses around the country. As a result of these losses, insurance companies have begun to increase deductibles to offset the exposure in states with heavy storm potential. This product will help ensure that ministries will have a great ministry risk management partner for the long term.
A wind-hail buyback is a separate policy that is designed to help property owners transfer the risk of a large cash expense, due to a large deductible, into something more manageable for the entity. It simply “buys down” the wind-hail deductible of the ministry property and liability package policy to mitigate risk for the insured and ministry insurance carrier.
An example would be as follows:
(Note: Policy deductibles vary. Please refer to your declaration pages or agent for your ministry’s deductible)
Total Insured Value = $2,450,000 (building & personal property)
Brotherhood Mutual Package Policy – church out of pocket – 1% wind/hail deductible = $24,500
Proposed Wind/Hail Deductible Buy Down Policy – church out of pocket = $10,000 (buyback of $14,500)
This separate policy would supplement your package policy, making wind and hail losses more affordable in the event of a large claim. Although helpful, it may not be necessary for everyone. Here are a couple question to ask to determine if this policy might be right for you:
Do we have $24,500 in cash readily available to be used in the event of a wind/hail claim?
If so, what kind of financial impact would that have on our budget?
If you have any questions or would like more information regarding the wind/hail buyback for your ministry, please reach out to your agent or our incredible service team. We are here for you, and we have your back! You can reach them by phone at 877-794-2330 or by email at firstname.lastname@example.org.
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