wfn.org | Insurance company explains decisions

[PCUSA.NEWS@ecunet.org]

03-July-1996 
 
GA96062 
 
Insurance company explains decisions 
 
ALBUQUERQUE--Media reports Monday accused Preferred Risk Mutual, the 
endorsed insurance carrier for the Presbyterian Church (USA), of canceling 
coverage for two African-American churches burned during the recent wave of 
arsons. 
 
    At least one major television news channel carried the report, which 
became the basis for a commissioner's resolution asking for an 
investigation of the insurance company. Jack Kelley, senior vice president 
for Preferred Risk, spent Monday in the Corporate and Administrative 
Services display area in the exhibit hall. He took a few minutes to respond 
to the media report and expound on his company's decision in regard to 
those two churches. 
 
    He said the television news channel making the report had never even 
contacted his company. Another reporter who did call (from a different news 
service) wanted to know how many black churches the company insured. 
 
    "We are asked, 'How many black churches do you insure?' Our response is 
we don't know, because we don't segregate any group of churches or people. 
It's against the law to separate them out," Kelley said. 
 
    "We insure churches, synagogues, mosques. We are the only company that 
is endorsed by the major black denominations (Congress of National Black 
Churches, which is comprised of eight denominations). With the Presbyterian 
program, we have 3,500 churches insured all over the country. One of the 
largest groups that endorses us is the Southern Baptists." 
 
    Preferred Risk was founded in 1947 and began specializing in insuring 
churches in 1960. It has been endorsed by the denomination since 1979, and 
insures approximately one-third of the denomination's churches. Kelley said 
the company does not insure--or cancel coverage for--churches based on 
their racial makeup. 
 
    "We're proud of our record of insuring churches," said Kelley. "It 
would be rather counterproductive that every time we had a loss, we 
canceled it (the policy)." 
 
    Kelley said his company insured five churches that suffered arson fires 
recently. One of those was a Presbyterian church--Matthews-Murkland 
Presbyterian Church in Charlotte, N.C. 
Another of the fires, at Salem Baptist Church in Pine Lake, Ga., was 
initially reported as an arson, but later determined to be electrical. 
Preferred Risk paid the entire claim. 
 
    The four remaining churches and the dates they burned are: 
Matthews-Murkland Presbyterian Church, Charlotte, N.C., June 6, 1996; Mount 
Tabor Baptist, Cerro Gordo, N.C., May 23, 1996; Mount Calvary Missionary 
Baptist, Bolivar, Miss., Jan. 31, 1995; and Salem Baptist, Humboldt, Tenn., 
Dec. 30, 1995.  In each case, the entire claim was paid by Preferred Risk. 
 
    Arrests have been made in two of the fires--Matthews-Murkland, where a 
13-year-old girl was charged; and Mount Tabor Baptist, where two black 
building contractors have been charged. 
 
    Kelley said it is true that Preferred Risk did not renew insurance 
policies for two of the churches--Mount Calvary Missionary Baptist and 
Salem Baptist (Humboldt). In both cases, however, all claims were paid  and 
the reasons for non-renewal involved more than just the latest arson  fire. 
 
    In the case of Mount Calvary, Kelley said, "I can tell you that 
including the fire, in four and one-half years, this church had six 
claims." 
 
    He said the church came to Preferred Risk for coverage in 1990 after 
not being renewed by another company. Preferred decided in June 1996 not to 
continue coverage. Kelley noted that since the decision was made, no one 
from the church has contacted Preferred Risk to question the decision. 
 
    USA Today reported Monday that the church's pastor is being 
investigated by federal officials in connection with the latest fire. 
 
    In the case of Salem Baptist, Preferred Risk had four claims from the 
church, including the arson fire that destroyed the building. 
 
    Kelley reiterated, "We have not had a complaint from any church we 
insure." Paul Ogden of the denomination's Corporate and Administrative 
Services, said CAS officials met Monday and concluded they had no reason 
for concern about Preferred Risk. "Everybody's satisfied," Ogden said. 
 
Nancy D. Borst 

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