Dear Friends,

BUSHFIRES AND OTHER DISASTERS
This week we first mourn for those lost in the bush fires in southern Queensland and northern New South Wales. There will soon be time to think about why bushfires are becoming more frequent and how we might as a nation respond to this: but now is the time for prayer and for helping our neighbours. The Dioceses most affected by bushfires at this time are Brisbane, Grafton and Newcastle: if any appeal is made I will let you know.

REMEMBRANCE DAY
Today we remember the 101st Anniversary of the Armistice to end the Great War. Sadly the First World War (1914 to 1918) was followed by the Second World War (1939 to 1945) and peace continues to elude us. Please pray for peace and pray for all those who have served or continue to serve in the Australian Defence Force. In God’s good time may our swords be turned in ploughshares and our spears into pruning hooks, and peace become the condition of humanity.

INSURANCE
Much of the energy of the leadership of our Diocese has been tied up over the last few weeks considering insurance. As you would know from previous communications we have been facing an increase in premiums for property insurance of over five times. Since being notified of this risk we have been looking into all sorts of ways of dealing with this problem. Underlying our thinking has been the basic premise that the Church is the Body of Christ: people come before buildings. Therefore our resources have to be used carefully and we cannot expend money on buildings if this interferes with our responsibilities to God.

Background

The Diocese takes out several forms of insurance. These include:
• Industrial Special Risks (ISR: that is insurance of property and contents)
• Other insurances such as public liability, professional indemnity, personal injury, motor vehicle insurance and so on

Essentially the first insurance is for our property, and the other insurances are for our people and for our neighbours. Our insurance premiums fall due on 1st November each year.
Unfortunately our insurance premiums (especially for ISR) are due to increase considerably. Our initial quote showed a five-fold increase. This reflects the increased number of claims made in North Queensland (such as those that followed the monsoon in Townsville); and the assessment of actuaries that due to Climate Change there will be an increased number of adverse weather events in North Queensland. All of tropical North Australia is facing significant increases in property insurance over the next twelve months. Our elected representatives are taking an active interest in this area.

Since being notified of the likely increase in premiums the Diocesan leadership has been actively canvassing any and all options. I am very grateful to Archdeacon Chris Wright for taking the leading role in this matter and to all those who have assisted him. Unfortunately there has been no satisfactory resolution for insurance of Diocesan property.

Current Situation

Under law, our insurance premiums are not due until 14 days after we have received notice of the new premiums. As of this date we have not officially received notice. However the following applies:

• Our current premiums for ISR work out at about 15 cents for every $100 insured compared to a national average of around 30 cents for every $100 insured; a reasonable insurance rate would therefore be about double our current premiums.

• Our new premiums for ISR are likely to be around $900,000 which represents 72 cents in the $100. This represents an increase of about 4.5 times our previous premiums. It also comes with an increased excess.

• It is not possible for individual ministry units to take out policies; only an incorporated body having ownership of the property can take out insurance. This means that only the schools, the aged care facilities, Anglicare NQ and the Corporation of the Diocesan Synod of North Queensland can take out property insurance.

• Heritage buildings must be repaired if damaged, but if substantially or totally destroyed they can be demolished rather than replaced.

• Properties that are leased by the Diocese usually require property insurance as part of the Tenancy contract: currently we lease out approximately 25 houses, one church hall and the offices, shop and house at St Johns Cairns which are leased to Anglicare NQ.

• The two stores (Kowanyama and Pompuraaw) need to be insured as ongoing businesses.

• Removal of debris only insurance is not going to be made available to us.

• We are legally and morally obliged to insure people and other people’s property, but we are not legally obliged to insure our own property.

It is also absolutely clear that we cannot pay insurance of $900,000; and that ministry units are not in a position to increase their insurance premiums by over four times. In the end we are here to carry out the Great Commission and the Great Commandments: we are not here to maintain buildings. Yearly premiums of $900,000 would lead to the effective end of financial support for any ministry.

Actions
After thorough discussions with all those who have been working on insurance, experts in the area, and our legal advisor, Diocesan Council has decided as follows:

1. That we continue with all personal and public liability insurances and all motor vehicle insurances and pay in full when due. We must insure fully our people and all those we come in contact with.

2. That we take out retail policies in the name of the Incorporated Body for all properties subject to formal lease arrangements.

3. That we take out business policies (including property and business continuance insurance) for Kowanyama and Pompuraaw stores.


4. That for all our other properties we self-insure. For the year 1st November 2019 to 31st October 2020 the Diocese will charge the ministry units 150% of their previous premiums, rising to 200% the following year. (For example, if a ministry unit had premiums of $10,000 in 2018/19 this would rise to $15,000 in 2019/20 and $20,000 in 2020/21). This money will be added to the aggregate deductibles fund and used to pay for any claims in excess of $3,000 by a ministry unit. Essentially over a two-year period our premiums will rise from the current low rate of 15 cents in the $100 to a more standard rate of 30 cents in the $100.

5. We will also continue to look for affordable insurance premiums aiming at the 30 cents in the $100 rate.

6. All properties are to be revalued.

7. Each Ministry Unit will receive an invoice which will clearly itemise the following insurances for payment to the Diocese:

a. Public liability, professional indemnity and other insurances related to protection of persons and third parties
b. Motor vehicle insurances
c. Landlord Insurance on properties leased to Anglicare NQ or other persons
d. ISR Insurance (that is, property insurance)

Clearly this approach carries considerable risk: we anticipate collecting $300,000 in ISR premiums in 2019/20 and $400,000 in 2020/21. If there is only one or two incidents (such as a fire) we will be able to cover those from collected premiums – but a widespread disaster would leave us exposed and perhaps put us in the position where all we can afford is removal of debris and making a site safe. However we simply cannot afford the crippling new rates: therefore it is a risk we have little choice but to take.

In the event of an emergency requiring immediate expenditure the Ministry Unit should contact the Area Dean, Archdeacon or Bishop: any of them can authorise immediate expenditure designed to prevent any damage becoming worse (for example, engaging a builder to stabilise damaged foundations). Any claim exceeding $3,000 should then be submitted to the Insurance Committee consisting of the Archdeacon and Area Deans. They will then make their recommendation to the Diocesan Executive. A claim can only be paid out if it would have been payable under the old ISR policy and it exceeds $3,000. The Diocesan Council Resolution giving effect to this policy is attached to this Bishop’s Bulletin.

Diocesan Executive Insurance Motion

I understand that this is a significant financial issue that impacts on the resourcing of our ministries across the Diocese. Please feel free to contact myself or Archdeacon Chris if you have any questions at all.

WELCOMES AND FAREWELLS
You are all invited to the Commissioning of the Reverend Karen Allen as Priest-in-Charge of the Atherton Tablelands, at 6.00 pm on Friday 22nd November 2019 at St Mary’s Church, Atherton. Clergy are invited to vest in alb and white stole. It is especially hoped that clergy and people from the Cairns region would be able to attend; it would be appreciated if stipendiary clergy from the Cairns region who are unable to attend would send me their apologies.
We say goodbye to the Reverend Dway Goon Chew and his wife Leeza: Dway has now been commissioned as the Rector of Tweed Heads in the Diocese of Grafton.

With sadness we also note the death of Fr John Hewitson, formerly of this Diocese and later in the Northern Territory. John has died at the age of 71 of pancreatic cancer; he was living at home in South Australia in the Diocese of the Murray.

Our Diocese is also served very well by a number of committed staff. This week we farewell Mrs Maya Reddy who had been our Diocesan Accountant for over eleven years. She has been extraordinarily diligent and committed to the Diocese, looking after both accounts and our stores at Kowanyama and Pompuraaw. We wish Maya every blessing as she retires to spend more time with her family: may God bless her.
She is being replaced in her stores management role by Adrienne Williams and as Accountant by Mr Mark Griffiths. We welcome both Mark and Adrienne to the Diocese.

DIOCESAN ACCOUNTANT
Mrs Maya Reddy has handed over her role as Diocesan Accountant to Mr Mark Griffiths and he is quickly learning about the Diocesan finances. If there are any questions that need answering, please direct your calls to Mark on 07 4771 4175 opt 2, opt 1 or accountant@anglicannq.org


The Right Reverend Dr Keith Joseph
Bishop of North Queensland

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