Employment Practices Liability Insurance typically covers allegations of discrimination, wrongful termination and sexual harassment of employees. A decade ago, when many insurance companies began taking large losses on these types of claims, Employment Practices Liability Insurance became a stand-alone insurance product for businesses.
Over the past decade, the number of discrimination cases has more than tripled in the United States, and a vast majority of these cases are filed against employers. Employment issues make up 30% of all civil litigation in the United States, and charges filed through the Equal Employment Opportunity Commission increase virtually every year. Publicly held companies, privately held companies and not for profit corporations are all at risk for being sued by employees and potential employees.
Employment Practices Liability Insurance Protect Businesses From Common Claims.
EPLI protects companies against claims that past, current and prospective employees of the company bring against the company, its directors and officers, and its other employees. Common employment practices violations include discrimination (based on sex, age, race, religion or other factors), sexual harassment, wrongful termination, and a variety of other employment-related claims which violate employees civil rights or their ability to perform their job in an acceptable and fair working environment. These types of claims can be extremely expensive to defend against, even if the court finds in favor of the employer.
Employment Practices Liability Insurance Should Be Part Of A Comprehensive Business Insurance Strategy.
EPLI is just one piece of the insurance puzzle intended to protect your business from liabilities it faces every day. This coverage can be highly customized, and should be one part of a larger insurance strategy to protect your business from exposure to risks. Many companies are now even willing to allow their small business customers to add EPLI onto their Business Owner’s Policy (BOP) for a small additional premium.