Running a business carries with it the concern about liability. D&O (Directors and Officers) insurance protects top management from claims of negligence as a result of their decisions. E&O (Errors and Omissions) insurance covers mistakes and omissions that your employees have made. These types of policies handle claims brought against your company by clients and customers. You must consider the fact that your employees can also file a claim against the business.
What Insurance Coverage Protects Against Employee Claims?
Many common employee claims are covered under Employment Practices Liability Insurance (EPLI). They include the following situations:
- Wrongful termination
- Sexual harassment
This type of policy can cover other inappropriate workplace behavior, such as the invasion of privacy, failure to promote and evaluation that is considered negligent. The policy keeps management, directors and employees as insureds, and it is written on the basis of claims made.
What Employee Issues Are Excluded?
Some situations not considered in EPLI policies include such things as bodily injury, dishonest acts and property damage caused by the employee. Injuries at work are covered under Worker’s Compensation laws, although the laws vary a bit from state to state.
A comprehensive management liability policy is a smart choice. Combining the different types of coverage into one package can help you cut costs and keep your business safe.