Why a Small Business Should Consider Employment-Related Practices Liability Insurance

Available as optional coverage to your Business Owner’s Policy, Employment-Related Practices Liability Insurance (EPLI) can protect your reputation and finances in the event that you face a lawsuit from an employee or prospective employee. The coverage is particularly important for small businesses, which are often even more vulnerable to these sorts of claims than larger businesses.

Protection From Day One

If you think your business is too small for EPLI, you’ll want to reconsider. As a small business owner, your business could be more at risk as you navigate the complexities of human resources, including hiring and firing employees, often without the benefit of in-house legal counsel or an experienced HR team to guide you.

EPLI coverage can protect your business if an employee, or a prospective employee, files a claim alleging discrimination, harassment, or that their rights have been violated in some other way. These claims can include:

  • Wrongful dismissal, discharge or termination
  • Breach of an implied contract
  • Sexual harassment or coercion
  • Discrimination (age, gender, race, color, national origin, sexual orientation, disability, pregnancy)
  • Retaliation
  • Wrongful deprivation of a career opportunity
  • Wrongful discipline

If your business faces this type of claim, not only would you risk damage to your reputation, you might also be buried in expenses. EPLI protects businesses against these claims, and covers the cost of defending your business, including legal fees and court costs.

Coverage Inside and Out

From the moment you begin interviewing, you could face claims and lawsuits from your employees and prospects based on hiring decisions and future claims based on terminations, discrimination claims, wage and hour disputes and other factors. This type of a lawsuit could have devastating effects for your company, both financially and for your reputation, but EPLI would help you cover that damage.

Not only does EPLI cover claims from employees, volunteers, or prospective employees, it also offers coverage for third party violations. If a customer, vendor, or other third party makes a claim against your business, you would need third party coverage, which EPLI provides. No matter the industry, if your business has direct contact with customers or vendors you run the risk of a lawsuit.

 

This material is provided for information purposes only and is not intended to be a representation of coverage that may exist in any particular situation under a policy issued by one of the companies within Crum & Forster. All conditions of coverage, terms, and limitations are defined and provided for in the policy.

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