When it comes to business insurance, the coverage options are practically endless. Many business owners are left wondering what coverage options are the right choice for their unique risks and needs. Employment practices liability insurance (EPLI) is one of the coverage options that is commonly misunderstood and underestimated by business owners. If you have been wondering whether EPLI is really necessary for your business, here are a few things you need to know about this important coverage option.
What Is EPLI?
Employment practices liability insurance provides financial protection in the event of claims made by potential employees, former employees or current employees in regard to wrongful acts committed during the employment process. When workers make claims that employers have violated their legal rights as employees, EPLI steps in and offers financial protection that is not typically provided by standard liability policies. Examples of claims covered by most employment practices liability policies include:
- Wrongful termination
- Hostile working environment
- Sexual harassment
- Mismanaged benefit plans
- Discrimination (disability, sex, race, age, etc.)
Some policies may also cover claims of invasion of privacy, defamation, emotional distress, battery, anguish, loss of consortium and more. They do not generally provide coverage for violations of the following: Occupational Safety and Health Act (OSHA), Consolidated Omnibus Budget Reconciliation Act (COBRA), Fair Labor Standards Act, or the Employee Retirement Income Security Act (ERISA).
To find out more about EPLI coverages and exclusions, or to modify your current policy to include this important coverage, talk to your insurance agent.