Church Satellite Campus Insurance: Lease Liability Gaps Growing Congregations Must Address
When a church signs a lease for a satellite campus, the excitement of expansion can overshadow a critical question: who is liable when something goes wrong at a location you don’t own? We’ve seen this pattern repeatedly with growing congregations—the board approves a lease for a school gym or commercial space, ministry launches within weeks, and nobody thinks about the insurance implications until there’s an incident.
Leasing space for a second or third campus introduces liability exposures that most church insurance policies weren’t designed to handle. The landlord’s insurance protects the landlord. Your existing church policy may or may not extend to a leased location. And the gap between those two policies is exactly where claims fall through.
Why Leased Satellite Campuses Create Unique Insurance Gaps
Most church insurance policies are written around owned property at a single address. When you add a leased satellite location, several assumptions built into your policy break down.
First, your property coverage likely doesn’t extend to a building you don’t own. Your policy covers your building, your contents, and your improvements. At a leased campus, the building belongs to the landlord—but your sound equipment, chairs, signage, children’s ministry supplies, and tenant improvements are your responsibility. If a pipe bursts and destroys $40,000 worth of AV equipment at your satellite campus on a Saturday night, the landlord’s policy covers the building damage. Your equipment? That depends entirely on whether your policy includes coverage for contents at leased premises.
Second, liability at a leased location creates shared exposure. If a visitor slips on an icy walkway outside your leased campus, both the landlord and your church could face a claim. The question of who maintained the walkway, who was responsible for snow removal, and whose insurance responds first gets complicated fast. In our experience working with multi-site churches, the lease agreement language—not the insurance policy—often determines who bears the initial liability.
Third, many church policies have a “designated premises” limitation. Your general liability coverage may specify your main campus address. Activities at an unlisted location might not trigger coverage at all unless you’ve specifically endorsed the leased space onto your policy.
The Lease Agreement Is an Insurance Document
Church boards often treat lease negotiations as a real estate matter and insurance as a separate conversation. That’s a mistake. The lease agreement contains insurance requirements that directly affect your coverage obligations and liability exposure.
Most commercial landlords require tenants to carry general liability insurance with minimum limits—typically $1,000,000 per occurrence—and to name the landlord as an additional insured on the church’s policy. This is standard and reasonable. But the details matter enormously.
An “additional insured” endorsement means your church’s insurance policy will defend the landlord for claims arising from your use of their space. That’s a significant obligation. If a child is injured during your Sunday children’s program at the leased campus, and the family sues both the church and the landlord, your policy may be defending both parties.
The lease should also specify that your insurance is “primary and non-contributory,” meaning your policy pays first before the landlord’s policy kicks in. This protects the landlord but increases your church’s financial exposure. We advise church boards to understand exactly what they’re agreeing to before signing—and to loop in their insurance agent during lease negotiations, not after.
One pattern we’ve noticed across growing congregations is that the lease gets signed by the lead pastor or executive pastor without board review of the insurance provisions. The board approved the expansion conceptually, but nobody scrutinized the indemnification clause that makes the church responsible for any injury on the premises during church hours, regardless of fault. That clause alone can shift hundreds of thousands of dollars in potential liability to your congregation.
What Your Multi-Campus Insurance Program Should Include
A growing church operating from leased satellite space needs more than a standard church insurance policy. Here’s what a properly structured program looks like.
General Liability Extended to All Locations
Your general liability policy must list every location where your church conducts activities—owned, leased, or temporarily used. Each satellite campus should be endorsed onto the policy with the correct address. Don’t assume “blanket coverage” applies. Ask your agent to confirm in writing that each location is covered.
For most multi-site churches with a single leased satellite campus, adding the location to an existing policy costs between $500 and $2,000 annually depending on the space size, occupancy, and local risk factors. That’s a fraction of what a single uninsured claim would cost.
Contents and Tenant Improvements Coverage
Your church probably invested in AV equipment, furniture, signage, flooring, stage construction, children’s check-in systems, and other improvements at the satellite campus. Standard church property coverage may not extend to these items at a leased location.
Request a “contents at leased premises” endorsement or a separate inland marine policy for portable equipment that moves between campuses. We typically see growing churches with $25,000 to $150,000 in equipment and improvements at satellite locations—significant enough that a loss would impact ministry operations.
Additional Insured Endorsements
Your landlord will require this. Make sure your policy can accommodate it. Most church insurance carriers offer additional insured endorsements, but the scope varies. Some only cover the landlord for your negligence; others provide broader protection. Match the endorsement to what the lease requires.
Hired and Non-Owned Auto Coverage
If staff or volunteers drive between campuses—transporting equipment, shuttling people, or running errands—your church needs hired and non-owned auto coverage. A volunteer’s personal auto insurance is primary if they cause an accident, but if their limits are insufficient, the claim rolls up to the church. Multi-campus operations increase driving exposure significantly.
Workers’ Compensation for All Locations
If you have paid employees working at any satellite campus—even part-time—workers’ compensation requirements apply. In Massachusetts, even one employee triggers the requirement. Make sure your workers’ comp policy reflects all work locations and the payroll associated with each.
Umbrella Coverage That Follows All Locations
Your umbrella policy should sit over all underlying policies and extend to every location. Verify that the umbrella doesn’t exclude leased premises or limit coverage to your main campus. A $1,000,000 to $3,000,000 umbrella is standard for multi-site churches in the 200-500 member range.
Common Mistakes We See in Multi-Campus Expansions
From working with churches navigating their first satellite campus launch, we’ve identified several recurring mistakes that create coverage gaps.
Mistake 1: Not notifying your insurance carrier. Your church adds a second location and nobody tells the insurance company for months. In the meantime, there’s no coverage at the new site. Policy conditions typically require you to report new locations within 30 days—some within 10 days. Missing this window can void coverage entirely.
Mistake 2: Relying on the landlord’s insurance. The landlord’s property insurance covers the building structure. It does not cover your contents, your liability to visitors, or your operations. The landlord’s liability insurance protects the landlord, not your church. These are fundamentally separate coverages.
Mistake 3: Ignoring the indemnification clause. Many commercial leases include broad indemnification language requiring the tenant to hold the landlord harmless for any claims arising from the tenant’s use. This means your church assumes liability for incidents that might otherwise be the landlord’s responsibility—like a structural defect or building code violation. Push back on overbroad indemnification clauses before signing.
Mistake 4: Using a facility use agreement when you need a lease. Some churches try to avoid formal leases by using informal “facility use agreements” with schools or community centers. While facility use agreements work for occasional events, a regular weekly worship gathering typically requires a formal lease—and the insurance obligations that come with it.
Mistake 5: Not reviewing insurance annually as the satellite campus grows. The satellite location that started as a Sunday-morning-only operation may now host midweek programs, youth groups, counseling sessions, and community events. Each new activity adds exposure. Your insurance should be reviewed every time programming expands at any location.
When Satellite Campuses Share Space with Other Organizations
Many church satellite campuses operate in shared spaces—schools, community centers, strip malls, or office buildings with other tenants. This creates additional liability considerations.
If your church shares a building with a daycare, a martial arts studio, and a tax preparation office, the common areas (parking lot, hallways, restrooms) present shared liability. A slip-and-fall in the parking lot could implicate any or all tenants. Your lease should clearly define maintenance responsibilities for common areas, and your insurance should account for this shared exposure.
Churches that meet in schools face a specific wrinkle: the school’s insurance program likely excludes coverage for the church’s activities. If a church volunteer is injured while setting up chairs in the gymnasium, the school’s workers’ comp doesn’t cover them. The church’s general liability or the volunteer’s personal health insurance would need to respond.
Frequently Asked Questions
Does our church insurance automatically cover a leased satellite campus?
No. Most church insurance policies cover activities at the address listed on the policy. A leased satellite campus must be specifically added to your policy, either as an additional location endorsement or through a separate coverage form. Contact your insurance agent before signing any lease to ensure coverage extends to the new space.
What insurance does a landlord typically require from a church tenant?
Most commercial landlords require general liability insurance with a minimum of $1,000,000 per occurrence, with the landlord named as an additional insured. Some also require property coverage for tenant improvements, workers’ compensation if you have employees, and a certificate of insurance provided before the lease begins.
Should our church involve our insurance agent in lease negotiations?
Absolutely. Your insurance agent should review the lease before you sign it. The insurance requirements, indemnification clauses, and additional insured obligations in the lease directly affect your coverage needs and costs. Involving your agent early can prevent surprises and ensure you can actually meet the lease requirements within your existing policy—or budget for necessary additions.
How much does it cost to add a satellite campus to our church insurance policy?
For a typical leased satellite space (5,000-15,000 square feet), expect to pay an additional $500 to $3,000 annually for general liability coverage at the new location. Contents and tenant improvement coverage adds another $300 to $1,500 depending on the value of your equipment and buildout. Total additional premium for a satellite campus typically runs $1,000 to $5,000 per year.
What happens if someone is injured at our satellite campus and we haven’t added it to our policy?
If the location isn’t listed on your policy and your coverage has a designated premises limitation, your insurer may deny the claim entirely. Even if the claim is ultimately covered under a broader interpretation, the delay and legal uncertainty can be costly. The church could face out-of-pocket defense costs and potential settlement exposure. This is why notifying your carrier immediately when you add any location is critical.
Can we use a facility use agreement instead of a lease for our satellite campus?
For occasional or short-term use (a one-day event, a weekend retreat), a facility use agreement may be appropriate. For regular ongoing use—weekly worship services, recurring programming—most legal and insurance advisors recommend a formal lease. A lease provides clearer terms for insurance obligations, maintenance responsibilities, and liability allocation. Using an informal agreement for regular occupancy can create ambiguity that hurts your church in a claim scenario.
Protect Every Campus Like You Protect Your Main Church
Expanding to a satellite campus is an exciting step for any growing congregation. But the insurance and liability framework that protects your main campus doesn’t automatically extend to leased space. Every new location needs intentional coverage—not assumptions.
Before you sign a lease, call your insurance agent. Before you launch services, confirm every location is endorsed on your policy. And before you assume the landlord’s insurance has you covered, read the fine print.
At Hale Street Insurance, we specialize in helping growing churches build insurance programs that keep pace with expansion. Whether you’re launching your first satellite campus or managing multiple locations across your region, we can review your current coverage and identify gaps before they become claims. Call us at 978.712.0111 or email jake@halestreetinsurance.com for a free multi-campus insurance review.
