Employment Practices Liability Insurance may Save Businesses from Costly Lawsuits

EPLI is an abbreviation for employment practices liability insurance. This type of coverage protects businesses against claims made by workers that the company is violating their rights as employees. In recent years, the number of lawsuits filed against employers by employees has been rising considerably. Although the majority of lawsuits are filed against larger companies, no business should assume immunity from such incidents. Since more insurers are recognizing the need for this coverage, many are adding it to their business insurance policies. An endorsement on a BOP alters the conditions and terms. However, some companies offer EPLI as an individual policy instead. This form of coverage offers protection for several types of claims, which include the following:

– Discrimination
– Employment Contract Breaches
– Sexual Harassment
– Wrongful Discipline
– Promotion Failure
– Employment Failure
– Wrongful Termination
– Wrongful Emotional Distress
– Employee Benefit Mismanagement
– Career Opportunity Deprivations
– Negligent Evaluation

The cost of employment practices liability insurance is not the same for all businesses. Premiums depend on the number of employees, the type of business and the history of the business. For example, a company that has faced such lawsuits in the past would have a higher premium than a company with a clean record. Multiple lawsuits put companies in a much higher risk category.

Employment practices liability insurance will reimburse companies for their court fees, judgement amounts and legal defense costs. Legal costs are covered regardless of whether the company wins or loses. If civil criminal fines or punitive damages are included in the incident, the policy will not cover either one. EPLI policies do not cover liabilities that are covered in other types of policies. In order to prevent lawsuits, all companies should work with their managers and employees to minimize problems in the workplace. Addressing issues before they arise and taking measures to make the company an optimal place to work are two helpful steps to take.

Companies should form good screening and hiring habits when it comes to adding new employees. This will help them avoid possible discrimination lawsuits. To make sure employees are aware of the company’s policies against negative practices, place posters in high-traffic areas of the workplace. These posters should clearly outline the company’s policies. It is also helpful to send policies to employees via email or written correspondence periodically. In addition to this, the policies should be included in employee handbooks and training manuals. If employees experience problems, they should know what to do next. For example, if an employee is the object of sexual harassment, he or she should know how to report the information and who is in charge of reviewing such reports. Any relevant incidents should be clearly documented by the company. For more information about this type of coverage, discuss concerns with an agent.

About Brian Hendricks

Brian Hendricks is the President of Fidelity Insurance Group. Brian started Fidelity in 2003 with 0 clients. Today Fidelity Insurance Group is a Premier Independent Insurance Agency in Florida with over 3,000 families and businesses insured. Brian currently serves on advisory boards for 2 of the largest property insurance companies in Florida. Knowlege, Integrity, and Committment are his and his agency's guiding principles.
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