EPLI Coverage: Why it’s Essential for Business
The American Bar Association defines Employment Practices Liability Insurance (EPLI) as “a form of coverage specially written to insure employers against liability for claims of discrimination, sexual harassment, and wrongful termination by their employees.” EPLI is commonly written either as a stand-alone policy or included with other crucial business coverages such as Directors and Officers and Errors and Omissions insurance.
One particular area that has been hit is the private sectors. According to Insurance Journal, employment bias complaints against private sector employers this year have reached an all-time high. The U.S. Equal Employment Opportunity commission (EEOC) said it received a record 99,947 charges of employment discrimination. And the type of discrimination suits have changed as well. The number of race and sex discrimination allegations decline from the previous year, while disability and age discrimination suits saw an increase. The EEOC has taken an aggressively proactive stance, placing pressure on business owners as they face increasing employment practice liability exposures.
Business cultures have a diverse environment with a wide range of individuals, ages, and experiences. While business owners strive to create the “best environment” for employees, they cannot control anyone’s behavior. And this is where EPLI comes in. Employee suits, or even allegations can be costly for employers. Even if they aren’t true, they can disrupt a business and cost an employer thousands of dollars in legal fees and time. Whether you are a large corporation or small business owner, Employment Practices Liability Insurance (EPLI) should be a part of your clients’ comprehensive insurance program. The policy provides coverage for legal fees, settlements and damage awards that result from employee claims of misconduct.