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Churches and Insurance for Members

Written by Gary North on January 2, 2016

I devoted the May/June, 1982 issue of Tentmakers, to the subject of health insurance. I discussed the problem facing all covenantally obligated churches, namely, the threat of a catastrophically expensive illness or injury, which strikes a member of the church who is not covered by medical insurance. The church has obligations to care for that person, yet a single catastrophic illness could wipe out a church treasury. In fact, the bill for one month’s hospitalization in an intensive care ward in a major city could wipe out most church treasuries. (Frankly, I think a week’s visit would do it.) What should a church do to reduce the potential financial obligations of such an event? (I also argued that few churches have even discussed such a possibility.)

I listed several options. First, older people should be encouraged not to retire from working if they are covered on the job by a group medical care policy. Second, the church should set up a voluntary reserve fund for insuring such events, asking older people, their relatives, and others in the church to donate to it regularly. Third, to make sure that all self-employed people in the church are covered by some sort of medical insurance. Then I offered several suggestions about what kinds of private health insurance coverage there are.

The policies available to people who “walk in off the street” are not very good, or are very expensive. Why? Because those who walk in off the street tend to be those who are sick. As one insurance professional told me, when group policies used to be offered to churches, only the sick would sign up. This, of course, forces premiums through the roof. The basis of all insurance — one of the marvelous inventions of the r modern world — is that the “law of large numbers” makes possible statistical predictions of certain kinds of events within a randomly selected “class” of people. Scientific investigation of events, coupled with the “miraculous” (and scientifically unexplainable) correlation between mathematics and the external world of human action, allows companies to predict with reasonable accuracy approximately how many homes will burn down each year, and how many people will die within a certain age group, and how many people will get sick. But to keep premiums low enough to be marketable, the companies must make sure that the “large number” of insured people is randomly distributed, and not filled with those who are more likely to be hit with the particular crisis. Insurance buyers demand this by demanding low premiums. There has to be a large, randomly selected class of people who will co-insure against the crisis in question.

One response to my essay in Tentmakers came from W.S. Hyland, who sent me a copy of The Journal of Pastoral Practice, Vol. V., No. 1 (1981), in which he had an essay, “Return of the Diaconate.” He thinks we should not become dependent on private insurance programs. I prefer to call this the pietistic view, in contrast to the State compulsion view (pro-tax-supported government insurance programs).

The author takes the view of the Amish, some Mennonites, and other historically pietistic Anabaptist groups: no profit-seeking, non-church insurance of any kind is biblically valid; He writes about “a major enticement the world otters and sells to believers — INSURANCE” (p. 7). The Word “enticement” was chosen to convey a sense of the danger, the implicit evil, of the “world’s” offer. You can almost see some insurance salesman in an alley, enticing passing Christians with “feelthy contracts.”

Term Insurance

Mr. Hyland is straightforward: “. . . insurance in no way benefits the church” (p. 7). He is absolutely serious. He is speaking of “term insurance.” Fair enough; he goes right to the heart of the matter: life insurance policies that pay the named beneficiaries upon the death of the insured individual — policies, in short, without a built-in “savings program” (whole life, ordinary life, etc.).

Sadly, the author does not understand his subject.

(for the rest of my article, click the link.)

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