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ASK THE EXPERT: The Importance of Bonds to Local Church Ministry

Updated: Jul 25, 2022

Much like property or commercial auto coverage, bonds play an important part in helping to keep your church protected. They’re issued to people with fiduciary responsibilities, and the Book of Discipline requires that all church treasurers be bonded. If your ministry doesn’t currently have a bonded treasurer, it could be at serious risk of financial loss should an incident arise.

A surety bond (bond) helps ensure financial obligations are met and/or provides coverage for certain damages if those obligations are not met. For example, if a treasurer intentionally or unintentionally mishandles funds, a bond can help your church recover associated losses. A bond mandates that the insurance policy that bonds the treasurer will pay a set amount of money to the insured if the treasurer does not meet a contractual obligation. It is important to remember that even if you have employee crime and dishonesty coverage, it may not necessarily provide the same level of protection as a bond. It may be insufficient in some cases. Unlike employee crime and dishonesty coverage, bonds do not require a deductible payment. A bond is a stand-alone product and the protection it offers is not typically included with standard property and casualty coverage. Another important thing to remember about bonds is that while treasurers are required to be bonded, bonds can be obtained for anyone at your church who has access to financial information. Bonding these individuals can offer your ministry added protection and is something to consider.

When you are covered by UMIP, we will be there when you need us. Churches have unique needs. As a part of the denomination, we understand the unique needs of United Methodist churches and their operations, which is reflected in our coverage options. Your ministry deserves outstanding insurance and UMIP works for you each day to help protect your church’s people, property, and finances.

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This content has been prepared by United Methodist Insurance Company (UMI) for informational purposes only. No article or document may accurately contemplate all possible scenarios or church resources. As such, this information is meant to foster discussion by the individual church and its members to develop a plan tailored to its own circumstances. UMI is providing this information with no warranties or guarantees of any kind and it should not be viewed as legal, financial, or other professional advice. All liability is expressly disclaimed. Any claim examples described herein are general in nature, may or may not be based on actual claims, and are for informational purposes only. Any coverage available for a claim is determined from the facts and circumstances of the claim as well as the terms and conditions of any applicable policy, including any exclusions or deductibles. In the event of a conflict with the content herein, the terms and conditions of any issued policy will control. Individual coverage may vary and may not be available in all states.

The commercial insurance coverages for United Methodist Insurance are sold and serviced directly or indirectly by Sovereign Insurance Agency (CA Lic. No. 0B01380) ("Sovereign") and underwritten by various available insurance markets. Sovereign pays United Methodist Insurance a royalty for the use of its intellectual property.


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