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GCFA plans Nashville move, launches insurance company

 


GCFA plans Nashville move, launches insurance company

Nov. 23, 2004       

By Joretta Purdue*

EVANSTON, Ill. (UMNS) — The United Methodist Church’s financial administration agency expects to start moving staff into a new headquarters building in Nashville, Tenn., later in 2005.

Voting members of the General Council on Finance and Administration saw pictures of the building where its Evanston and Nashville staff will be combined during their Nov. 18-20 annual meeting in Evanston. The Nashville property purchase, which is contingent on various structural and environmental inspections, will provide a new headquarters for the agency.

Internal modifications of the space will be made in the first seven months of 2005, allowing the present Nashville staff to move into the building in August. Services currently provided in Evanston will gradually be moved during the following 12 months to minimize disruption. Sale of both properties currently occupied by the agency is anticipated.

In five years, GCFA expects to realize a net savings from the move, according to Sandra Lackore, head of the agency and treasurer of the United Methodist Church.

Saving money is also part of the motivation for founding the captive insurance company that GCFA launched for the church, at this meeting, by providing initial funding and becoming the first member. Such a company is owned by the insured entities that share a certain amount of risk. Beyond that point, reinsurance is provided by a larger reinsurer.

“We’re currently paying millions of dollars ... to a for-profit organization” for insurance, said Craig Parrish, chairman of the committee that formed United Methodist Property and Casualty Trust.

As owners, GCFA and annual conferences will take on some risk and have more leverage with the reinsurance company to achieve price stability and broader coverage, Parrish explained. PACT will be marketed to annual conferences initially, and their local churches will be part of that. PACT is not able to serve individual congregations at this time, he added. The general agencies of the denomination are eligible to join.

Parrish stressed the importance of PACT’s theological foundation, which he believes supports the company’s ability to “offer protection and justice.” And he emphasized the risk management opportunities to prevent such things as sexual misconduct or theft and to work for justice for victims rather than solely seeking to minimize costs.

“We insure mission and ministry,” he declared.

Coverages will include property, general liability (casualty), automobile liability, sexual misconduct, pastoral professional liability, employee benefits liability, bonding, worker’s compensation, directors and officers’ liability, and employment practices liability. Health insurance is not included.

“Millions of dollars in equity can be put back into ministry,” Parrish said, “depending on our actual experience of loss.” He pointed to the success of several other denominations and religious organizations, varying from the Assemblies of God, which only has one year of experience, to the Seventh Day Adventists, which has 68 years. “No religious captive has ever failed,” he added.

Within the denomination, a similar plan in the Florida Annual (regional) Conference has been successful even with multiple events during the 2004 hurricane season, Parrish said. After Hurricane Andrew in 1992, many insurers withdrew from the Florida market.

Following approval of the formation of the captive insurance company, GCFA executives will seek to incorporate the company in Washington.

Claire Irene Howard, who has been general counsel for GCFA, has been designated chief executive officer of PACT. She also was named GCFA deputy general secretary for strategic initiatives, effective Jan. 1. James R. Allen, who joined the GCFA legal team in 2003, has been named general counsel to succeed Howard.

Reflecting another transition in the denomination’s structure, the GCFA, acting as trustee for the whole church, accepted the responsibility for control of all properties formerly owned by the General Council on Ministries, which was discontinued by the 2004 General Conference, the denomination’s top legislative body. GCFA members authorized the GCFA executive committee to act as needed for the agency and trustees regarding GCOM property to implement the transition team’s plans for action.

GCFA provided support – financial and staff – for several studies, including Connectional Ministry Funding Patterns II, the GCFA Data Services Study and the Study of the Episcopacy.

In other action, GCFA members:

  • Approved the 2005 spending plans of the denomination’s general agencies.
  • Agreed to the 2005 Episcopal Fund spending plan of just more than $17.1 million.
  • Reviewed and approved financial plans for several national or international conferences.
  • Elected to coordinate retiree pharmacy benefits with Medicare Part D.
  • Established guidelines for the submission of requests for grants from World Service and General Administration contingency funds.
  • Approved certification or recertification for more than 100 professional United Methodist Church secretaries and two church business administrators.

GCFA members joined in celebrating the 16 years of service of Elizabeth Okayama, who works in administering the Episcopal Fund in support of the bishops, and the six years of service of the Rev. Robert W. Fishel, a GCFA executive in the area of finance and administration. Okayama retires in March and Fishel in June.
 
The council’s next meeting will be Nov. 17-20, 2005, at Lake Junaluska, N.C.

*Purdue is a former United Methodist News Service news director.

News media contact: Linda Bloom, New York, (646) 369-3759 or newsdesk@umcom.org.

 

 

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