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The Limits of Liability Insurance

New Jersey
Key point 10-16.7. A liability insurance policy provides a church with a legal defense to lawsuits claiming that the church is responsible for an injury, and it will pay any adverse settlement or judgment up to the limit specified in the policy. Liability insurance policies exclude a number of claims. For example, some policies exclude injuries based on criminal or intentional acts and claims for punitive damages. A church has an obligation to promptly notify its insurer of any potential claim, and to cooperate with the insurer in its investigation of claims.

A New Jersey federal court ruled that a church's insurance policy did not provide payment of defense costs or any settlement or judgment in a lawsuit brought against a minister for a sexual affair with a female member of his church. A minister became acquainted with a married couple in his church. He engaged in an extra-marital affair ...

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  • February 20, 2015