Employment Practices Liability Insurance (EPL Insurance or EPLI)
What is employment practices liability insurance?
Employment practices liability insurance is a form of liability insurance which is designed to protect employers from certain lawsuits or claims made by employees alleging acts such as sexual harassment, wrongful termination,
discrimination and other employment-related wrongful events.
An employment practices liability insurance policy typically protects a company including its directors, officers, and employees against claims made by current employees, former employees, and prospective employees.
What is covered by an employment practices liability insurance policy?
An employment practices liability insurance policy typically provides coverage against actual or alleged wrongful employment-related acts, including but not limited to the following:
Wrongful dismissal, discharge or termination of employment
Breach of a written or oral employment contract or implied employment contract
Hostile work environment
Failure to hire
Failure to promote
Libel, slander, defamation
Infliction of emotional distress
Who needs employment practices liability insurance coverage?
Any company with employees should consider coverage for employment practices liability insurance. Complaints and lawsuits by employees claiming that their legal rights have been violated have been rising in recent years.
The Equal Employment Opportunity Commission, which is the federal agency enforcing workplace discrimination laws, handles around 100,000 complaints a year. In addition, certain complaints can be handled by state agencies or
can be handled directly through a lawsuit.
According to a study published by Chubb in 2010, the average cost of an employment practices liability complaint or lawsuit in the prior five years was $51,975, while the median compensatory award for an employment practices liability lawsuit was $326,640 in 2008.
Because the cost of complaints and lawsuits brought by employees can be substantial and time consuming, it is important for employers to have the proper employment practices liability insurance coverage.
Call us at 1-877-245-5887 if you have any questions regarding employment practices liability insurance or wish to discuss your insurance needs.
We're looking forward to earning your business.