Seen in Monday’s Wall Street Journal: (subscriber link)
A small protestant church in Adrian, Mich., has weathered controversies surrounding abolition, the Civil War, desegregation and Vietnam since it was established in 1836. Now, because its denomination supports gay rights, the church has been deemed too risky for property insurance.
Brotherhood Mutual Insurance Co. of Fort Wayne, Ind., turned down the West Adrian United Church of Christ, citing its national governing body’s approval of gay marriage and the ordination of homosexuals.
“Based on national media reports, controversial stances such as those indicated in your application responses have resulted in property damage and the potential for increased litigation among churches that have chosen to publicly endorse these positions,” Marci J. Fretz, a regional underwriter for Brotherhood Mutual — one of the nation’s largest insurers of religious institutions — wrote in a letter to the church last summer.
While I can imagine a slightly increased threat of physical damage (but then again, churches are surprisingly vulnerable to physical damage; remind me to tell you of the church I was in which was struck by lightning…twice)…increased liability risk?
In commercial lines property/casualty insurance business, insurers generally have additional flexibility in accepting or declining risk than they do in personal lines…so it does seem within the insurer’s rights to do this. However, it seems wrong.