Employment Practices Liability – EPLI Insurance
What is it
Employment Practices Liability, commonly referred to as EPLI, provides coverages to employers for claims made by employees alleging discrimination (based on sex, race, age or disability, for example), wrongful termination, harassment and other employment related issues, such as failure to promote.
why do i need it
Employee practice claims have been trending higher and not having any EPLI coverage could cost you big time. Lawsuits are expensive and could put a huge strain on your business both mentally and financially.
Who needs it
Any type of business that is large or small should purchase an EPLI insurance policy to protect them against potential claims. Even If you have just one employee, you are exposed to the risk for employment lawsuits.
Employment Practices Liability, also known as EPLI coverage, extends beyond the standard coverages. EPLI coverage can protect you for the following:
- Breach of contract
- Emotional distress
- Negligent evaluation
- Wrongful discipline
- Wrongful termination
- Other violations
In addition the EPLI insurance policy will reimburse you for costs of defending a lawsuit in court and for judgements and settlements. It covers legal costs whether your company wins or loses a suit. Some insurers, recognizing that smaller companies now need this protection, will add the coverage by endorsement to a business owner policy, while others offer EPLI as a stand-alone policy.
Does my BusinessOwners Policy or Commercial Insurance cover me for sexual harassment related claims?
The general liability limits within a business owners policy or commercial insurance policy only covers bodily and advertising injury, and property damage. Without purchasing a separate employment Practice liability insurance aka EPLI policy, an employer will be without any coverage to defend costly employment claims.
What’s the difference between an EPLI policy and a Workers’ Compensation policy?
Most business owners assume Workers’ Compensation will cover all employee related issues. However, that's not the case- you need a separate policy for this. Business owners are often confused because Workers’ Compensation has two parts of coverage. The first part pays for an employee’s medical bills and lost wages after a work injury or illness. The second part pays for legal expenses when employees sue the business for the injuries that occurred due to the employer’s negligence.
Does an EPLI policy give me defense coverage for claims made against my business?
Yes, the EPLI insurance policy provides first dollar defense coverage for your legal expenses related to defending you.