Insurance and Savings

 Most of what was shared about insurance premiums at the last presbytery was also shared by Doug Weims when we switched to Brotherhood Mutual, but we decided not to act on any cost-saving choices at that time.

One thing worth considering is building funds to a level of self-insurance to minimize our cost. I don’t think we can ever go insurance-free because of liability issues and some presbytery requirements. But we could start moving that way.

If we take out a second CD, we should add to it with whatever we save by increasing our deductible. So, if we save $500 each premium, we don’t put that in the general operating fund; we obligate it for the CD and add it to the CD upon renewal.

I suggested something like this when we paid off the loan we took out for the building. We would continue to budget the $2000 each month for our savings/CD/capital program (whatever name we had at the time), with the intent of having some self-insurance fund. We opted not to do that at that time.

To the current situation, savings on insurance and investment in a CD will seem like small savings in comparison to the very large amount needed to adequately insure the buildings that we have, but it’s that inertia thing again. Nothing happens until something is put in motion. A body at rest remains at rest—you know the spiel.

It’s the "he buried his talent in the ground" thing. The risk of putting the money in a CD is minimal. If we needed it before it matured, the most we could lose is the interest. The principal is not at risk. We get about 10-16 times the interest on the CD than we do on the savings account, where a fair amount of money now resides.

It’s also that discipline thing. Disciples should have discipline. In the case of insurance savings and what to do with it, that means if we do this, we do this with each premium. This is not a when we feel like it deal. It is a call for discipline. Our children or grandchildren might be the ones who realize a level of savings where we can significantly reduce our premiums and add to the savings.

What is the risk? If we had to cash it in early, the actual loss to us would be the quarter percent interest that leaving it in savings would earn. Yes, we could potentially lose ten times that amount, but only if we put the funds in a CD. If we leave them where they are, we have no chance at potential gains.

It’s the you miss 100% of the shots you never take thing. It won’t lose anything if we do nothing differently, but we gain very little.

I did not put this on the agenda as you will surely need time to assess it and weigh it against your risk tolerance, but I wanted you to think about it. I know it historically goes against our tendencies as a session.

If you subscribe to Covey’s four quadrants, this is a quadrant II decision. Maybe it will prompt us to action at some point.

If we don’t do this, it should be a deliberate decision and not a passive oversight.

Please think and pray about this.