What is EPLI?
Employment practices liability insurance (EPLI) is insurance that protects businesses against employment claims, including discrimination, harassment and wrongful termination. This coverage, sometimes mistakenly called “EPLI insurance,” could support your business regardless of whether the claim is legitimate.
Companies must respond to these employment claims, which most business insurance policies don’t cover. Adding EPLI coverage as an endorsement to your existing general liability insurance or business owners policy (BOP) could shield your company from major financial loss.
What does EPLI cover?
EPLI policies cover the legal cost of defending your company from allegations made by employees, former employees and job applicants.
Some common examples of EPLI claims involve:
- Sexual harassment
- Wrongful termination
- Invasion of privacy
- Breach of employment contract
- Failure to employ or promote
EPLI protections typically include your employees, executives and business. Your EPLI coverage could help if your company, leadership or employee is accused of wrongdoing.
How can I help my business avoid an EPLI claim?
You can help your business avoid an EPLI claim by standardizing company procedures:
- Write an employee handbook and code of conduct and review them annually
- Clarify practices for screening and hiring candidates
- Document and save employee interventions, such as performance warnings and improvement plans
- Record all actions your company takes to settle employee disputes
These actions show your commitment to a fair and transparent workplace, which could reduce employee complaints and support you in the event of a claim.
How much does EPLI cost?
EPLI cost depends on several factors, including your number of employees, employee turnover and claims history.
For example, companies with higher employee turnover might pay more for EPLI coverage than businesses with long-term employees since more turnover means more exposure to employee grievances. These circumstances could increase the risk of an EPLI claim.
An EPLI quote is the best way to determine how much you’ll pay.
Choosing the right EPLI policy
Choosing the right EPLI policy for your company requires you to evaluate your business’s needs. EPLI fills a crucial gap in your business insurance policy by covering employment claims that other products don’t. You can add an EPLI endorsement to the following coverages:
- General liability: General liability insurance protects your business from a variety of third-party claims, including bodily injury, property damage and personal injury.
- Business owners policy (BOP): A BOP covers both general liability and property insurance.