Employment Practices Liability Insurance (EPLI) covers businesses against allegations by workers that their legal rights have been violated by their employers.
While some insurance companies offer EPLI as a stand-alone coverage, other insurers provide this coverage as an extension of additional coverage to their Business Owners Policy (BOP).
Here are some examples of the types of employee lawsuits against which EPLI protects the insured:
• Sexual harassment
• Wrongful termination
• Failure to employ or promote
• Breach of employment contract
The cost of EPLI coverage depends on your industry and the number of employees you have, in addition to risk factors such as your company’s claims history and written policies, as well as the procedures and limits of coverage requested. The policy covers legal costs, and pays damages to the injured party, if the lawsuit is favorable to the damaged party. The insured’s policy should reimburse for the costs of defending a lawsuit, regardless of whether the suit is won or lost in court.
EPLI is one of many ways to safeguard your business and should be considered part of an overall protection plan.