Insurance Claim

[Eden Whitehead]

The church has received a check from the insurance company for a loss experienced earlier this year (flood damage). This is a first for me so I need help in knowing how to record the transaction.

My thinking is that this is not technically income, so should not be credited to an income account. This church has never set up an asset account for the building/property itself. To date, no expenses have come through related to the loss.

The check has been deposited in the general fund checking account.

What type of account should I set up to balance the debit in the checking asset account?

(Reading what I've just typed, I'm not sure I even know enough to ask the question intelligibly!)

Thanks in advance for the generous and reliable help that is characteristic of this forum!

Eden

[JohnDMeyers]

Eden:

I would set it up as an asset. Transfer from checking to the insurance settlement asset for now, and back into the checking little-by-little as you write checks against it.

[debbieg]

We had a similar situiation this year from hail damage to our roof. Since the reimbursement was worked out with the claims adjuster and the repair company, we knew the money would all be spent (and then some).
Not sure if this was correct but I just credited the expense account for Maintenance that would be used when we started paying for the repairs. At the end, the expense account should show our out of pocket expense. the rest will be a wash.
Debbie