Church board members have been placed in a position of trust, and they have a legal responsibility to place the church’s interests ahead of their own. This duty is known as their fiduciary responsibility. We always recommend board liability insurance, contact us today!

If board members use their position in the church for personal gain, they can be sued as individuals, thereby placing their home and personal assets at risk. But the same laws that protect corporate board members in the secular world can also help protect ministry board members who are acting in good faith. There are two primary requirements that board members must follow in order to obtain corporate protection. These requirements can be summarized as the “Prudent Person Rule” and the “Duty of Loyalty.”

The Prudent Person Rule. Board members have a duty to think matters through before making key decisions. The prudent person rule basically states that a board member will be protected from personal responsibility unless a “reasonably prudent person” would have avoided similar actions or decisions.

The Duty of Loyalty. Board members have a duty to avoid conflicts of interest. The duty of loyalty requirement states that board members will be protected against personal liability as long as their actions and decisions aren’t intended to provide them with personal gain.

Members of the church governing board are responsible for guiding the church and helping the ministry fulfill its mission. Board members are held to a higher standard of accountability than others in the congregation. By placing the interests of the church above their own, they will not only better serve the church, but can also protect themselves from legal liability, fines and other out-of-pocket loss.

Christian Ministries Insurance will provide sound advice, training and insurance programs designed specifically for your ministry. We provide much of our unique risk management consulting services at no additional cost

This entry was posted on October 6, 2014 at 11:43 pm. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.

Posted in church board by Scott Stuart Comments Off on A Must Read For Every Church Board Member