Is Directors and Officers Insurance Incomplete Without EPLI Coverage?
Many times, events that are out of your clients’ control may lead to an EPLI claim. For example, what if a branch goes out of business, or your client is forced to lay off employees? Mergers and acquisitions are other things that will affect your clients’ employees, even though these decisions and changes may not be entirely in their control.
Unfortunately for these reasons, many employees who file a claim are going straight after the Directors and Officers of the company. Directors and Officers Insurance protects those entities of the company against losses or advancement of defense costs in the event that an insured suffers a loss as a result of a legal action for alleged wrongful acts. These claims may come from customers and partners, but also from employees.
Employment Practices Liability Insurance (EPLI) covers wrongful acts arising from the employment process, so claims such as wrongful termination, discrimination, sexual harassment, and retaliation. It’s important for your clients to be aware that today’s EPLI claims are directly related to Directors and Officers Insurance, meaning that a D&O policy is not complete without EPLI coverage.
In fact, it’s estimated that approximately 50% of all Directors and Officers Insurance claims are tied to EPLI claims. Employees that may have been silent before about harassment or discrimination suspicions are now speaking out and taking action against Directors and Officers.
At PL Risk Advisors, we have the experience, knowledge, and markets to secure the policies your clients require. We can help secure D&O Insurance as well as Employment Practices Liability Insurance to protect them and their companies in the event there is an allegation that they have failed to perform their duties. Please contact us today to learn more at (855) 403-5982.