Employment Practices Liability Insurance
Small companies are not immune to employment problems and lawsuits. While most small companies consider that the problems EPLI protects from are those that confront larger businesses, the reality is according to many insurers, up to half the EPLI claims filed are against small business. Small companies which often have looser cultures, in that there are less policies and procedures are particular vulnerable as they often also lack employment practices knowledge and a HR department. The immediacy and closeness of smaller cultures can also lull an employer into a more “relaxed” even unprofessional style of management.
As part of purchasing coverage, employers have to carefully consider what kind of challenges are most likely to confront their business and act accordingly to leverage their insurance assets. For example, when discussing EPLI, harassment and discrimination claims are what most often first comes to mind for many. While employers understandably and rightly so worry about harassment and discrimination claims, the reality is wage and hour claims can be just as, if not more, costly to an employer. However wage and hour claims are often excluded from basic EPLI policies. So an employer has to scrutinize their liability carefully and then ask careful questions to determine appropriate and adequate coverage.
EPLI is rapidly becoming an increasingly common form of business insurance coverage that as an insurance asset can often mitigate an employer’s liability in regards to employment practices. Although EPLI is available as a stand-alone coverage, it can be sold as part of other business coverage.
Employment Practices Liability Insurance known as EPLI or sometimes-just EPLI, is a form of insurance that covers businesses against claims by employees, sometimes even prospective employees, that their legal rights were violated. Every businessperson and HR professional cannot escape the knowledge that there are a myriad of employee legal protections that are numerous, complex and that such protections increase in scope rapidly. In fact, challenges to your company’s business employment practices can begin the minute you start an interview with a prospective employee.
- Why EPLI coverage
- Types of EPLI coverage
- Pros and cons of types of coverage
- 12+ important things to consider and questions to ask that you may not think to ask
- Considering wage and hour coverage
- What is excluded from EPLI
- One critical reason to make sure you go with the right company the first time around.
- What is “Extended Reporting Period” coverage and why it’s important.
- Evaluating the importance of Third Party Coverage