Gulfshore Insurance > Gulfshore Blog > Commercial Risk Management > 3 Requirements When Renting Your Church Facility: Your Church’s Potential Liability from Third Party Users

3 Requirements When Renting Your Church Facility: Your Church’s Potential Liability from Third Party UsersIs your Church renting the facility? How about providing a venue, even at no cost, to community associations, clubs, or other charitable organizations? If so, there are some important steps to take to protect the Church from unexpected claims, allegations, or even lawsuits. Any time the Church facility is used by third party individuals or organizations (think weddings, Boys/Girl Scouts, home school groups, after school tutoring, etc.) we should take the following 3 steps to best protect the Church:

  1. Get a signed Facility Usage Agreement with indemnification from the person or group. This agreement acts like a mini contract which outlines who is responsible for what. Even if there is no rental fee or monetary exchange, the Usage Agreement will transfer legal responsible for acts of the renter (or their volunteers, employees and guests). This can help avoid the Church getting dragged into a claim or lawsuit for damages or injury caused by the third-party. A well-written Usage Agreement with an indemnification clause and Additional Insured status will provide the Church protection on the renter’s liability insurance and a promise to be reimbursed for any costs the Church may incur due to the third-party’s negligence. This should be non-optional, standard operating procedure. Follow the link to download a sample Usage Agreement.
  2. Get proof of minimum insurance limits from the person or group. Individuals should provide proof of liability insurance from a homeowner’s or renter’s policy with a minimum of $300,000. Businesses and organizations should provide a formal Certificate of Insurance showing evidence of General Liability coverage with a minimum limit of $1,000,000.
  3. Restrict access to other parts of the facility.  While the Usage Agreement will outline what part of the facility is available for use, the Church should take the prudent step to physical restrict access to other parts of the building or facility. Guests tend to wander, and kids can go looking for adventure, or trouble, so if possible, lock up other rooms, buildings or amenities that are not in use.  Computers, offices, classrooms, kitchens, playgrounds, and storage closets are best kept locked when third-parties are using the facility. Even though a staff member or custodian should be on site, it’s prudent to physically restrict temptation.

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John Keller, CRM ARM CIC AAI is Client Advisor & Risk Manager at Gulfshore Insurance specializing in non-profit and religious organizations. John works with a wide range of business clients to deliver strategic risk analysis and guidance. Comments and questions are welcome at